Sri Lankan inflation dips to record low in June

COLOMBO, July 1 (Xinhua): Sri Lanka's inflation dipped to a record low of 2.8 per cent in June as the country maintained single digit inflation for the 65th month in a row, the country's central bank said on Tuesday.
Inflation decreased to 2.8 per cent in June 2014, on a year-on- year (YoY) basis, from 3.2 per cent in the previous month.
The annual average inflation also continued its decelerating trend since June 2013 and reached 4.9 per cent in June 2014, easing from 5.3 per cent in May 2014, the central bank added.
"The relatively low increase in prices of items in the non-food category and the base effect contributed substantially to containing inflation at low levels in June 2014," the central bank said in its latest report.
However, it acknowledged the prices of food items had increased significantly in June due to rainy weather that is likely to continue into July.
"Core inflation, being a more reliable predictor of future outlook for inflation, declined on an annual average basis to 3.0 per cent in June 2014 from 3.1 per cent in the previous month, recording the lowest level since its inception," said the report
Meanwhile, YoY core inflation increased slightly to 3.5 per cent in June from 3.3 per cent in May.
The central bank expected the 60-billion-US-dollar economy to grow by 7.8 per cent in 2014.