Colombo prices rise 1.2% in August, ending 11 months of deflation

ANNUAL FOOD PRICES ROSE BY 2.0%, PICKING UP FROM 1.5% RISE THROUGH JULY 2025 NON-FOOD PRICES ROSE BY A MODEST 0.2% IN AUGUST, SLOWING FROM 1.0 PERCENT INCREASE IN JULY

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Sri Lanka’s Colombo district recorded a 1.2 percent increase in consumer prices in August from a year ago, turning from a 0.3 percent decline in prices continued through July, ending the 11-month spell of negative inflation, which set off in September last year.

August was largely expected to return to positive prices after a series of decelerating negative inflation readings in the lead up to the August print.

The August inflation print is also in line with the Central Bank’s inflation forecast, which projected inflation to return to positive from the third quarter, before reaching its 5.0 percent medium-term target by the middle of 2025.

Despite the annual prices resumed rising, predominantly due to the lower base effects last year, the prices measured monthly fell 0.4 percent in August, rising from the 0.2 percent decline in July.