Sri Lanka High Commission in Ottawa

Continuing the sustained low inflation environment for the 68th  consecutive month, headline inflation on a year-on-year (Y-o-Y) basis remained unchanged at 3.5 per cent in September 2014 while declining on an annual average basis to 4.2 per cent from 4.5 per cent in the previous month. Core inflation (Y-o-Y) meanwhile, decelerated to 3.7 per cent in September 2014 from 3.9 per cent in August 2014. The significant reduction of international energy prices and the improvements in the domestic electricity infrastructure have enabled the government to reduce domestic energy prices, and the benefits of these adjustments have now begun to reflect favourably on inflation. This development, along with the continued deceleration of the prices of other key commodities in the international market, is likely to result in inflation remaining at a lower rate than the previously projected range of 4-5 per cent in the period ahead.

Read more: Monetary Policy Review – October 2014