Sri Lanka Equity Forum
Dear Reader,

Registration with the Sri Lanka Equity Forum would enable you to enjoy an array of other services such as Member Rankings, User Groups, Own Posts & Profile, Exclusive Research, Live Chat Box etc..

All information contained in this forum is subject to Disclaimer Notice published.

Thank You
Sri Lanka Equity Forum

Discussion Forum for Stock Market Investors in Sri Lanka

සිංහල පරිවර්තනය
Submit Post
Submit Post
Market Place

Add an ad

View all ads

Latest topics

» Keep eye on Politics
by Yahapalanaya Today at 6:25 pm

» Bottom of market
by samaritan Today at 6:14 pm

by mahasona2 Today at 1:00 pm

» lOFC definitely will hit 6/-
by mahasona2 Today at 12:56 pm

by mahasona2 Today at 12:54 pm

» Why AAIC Should trade above RS.50/-
by wisdom79 Today at 12:38 pm

by Nuwan Samarawickrama Today at 10:33 am

» Triple Top Reversal pattern
by Yahapalanaya Today at 8:59 am

» Aluf will be better
by wisdom79 Today at 8:50 am

» Stop promoting garbage. Don’t get deceived.
by wisdom79 Today at 8:46 am

» RICH is not bad @ 9/-
by Teller Today at 3:18 am

» BFN බොරු සෙලින් දාලා කොහොම හරි 11 වගේ ගානට 500000 එකතු කරගන්න කියලා අර 14 ට ලක්ශයක් සෙලින් දැම්මේ මේ ටේලර් මහත්තයාම තමයි
by Teller Today at 3:16 am

» Be careful with HVA and LITE
by Teller Today at 3:11 am

» WATA future looks good
by Teller Yesterday at 10:00 pm

» If i am the EPF buyer,I will go for PLC
by Teller Yesterday at 9:59 pm

» LLUB Pattern reversed. Good buy @60, target +20%
by Teller Yesterday at 9:58 pm

by Teller Yesterday at 9:04 am

» Why we should buy AEL.N0000…?
by Miss-Sangeetha Yesterday at 7:45 am

» The Curse Of AEL
by Yahapalanaya Tue Jun 18, 2019 11:06 pm

» Senthilverl Drives Sri Lanka Stock Market Turnover to hit Rs.2 billion
by Yahapalanaya Tue Jun 18, 2019 11:03 pm

» 8 Finance companaies to be closed very soon
by samaritan Tue Jun 18, 2019 8:52 pm

» Copreus (Pvt) Ltd - Need some Information
by Copreus Tue Jun 18, 2019 12:44 pm

» BALA can come down to 9/-
by Teller Tue Jun 18, 2019 12:27 am

» MARKET UP......BUT BFL....GRAN....TAFL......
by Trader321 Mon Jun 17, 2019 4:31 pm

by Trader321 Mon Jun 17, 2019 4:29 pm

» MGT.N0000 & TJL.N0000 keep eye.
by Trader321 Mon Jun 17, 2019 3:58 pm

» TAFL.N000 / GRAN.N0000
by Trader321 Mon Jun 17, 2019 3:57 pm

» Market will test 4700
by karuna2 Mon Jun 17, 2019 1:08 pm

» Loss-making stockbrokers may not last six months
by Miss-Sangeetha Mon Jun 17, 2019 12:51 pm

» Those who are having SUGA And HDEV (Hotel Developers)coming week you all can excpect Good News to come
by Capton KIng Cool Mon Jun 17, 2019 12:25 pm

» ECL wAS 2.8 Last week Today 4.7 .Whats Next? Acme?
by Capton KIng Cool Mon Jun 17, 2019 9:02 am

by Teller Sat Jun 15, 2019 6:18 pm

» Look APLA its trending to 98LKR
by Teller Sat Jun 15, 2019 2:24 am

» SAMP Oversubscribed?
by Teller Sat Jun 15, 2019 2:13 am

» Apple Lost Sales in Europe to Chinese Firms Ahead of US Huawei Crackdown
by Teller Sat Jun 15, 2019 1:44 am

» Market is On The Rise.Market PER 8.5, EPF Has entered the market curently they are buying AEL (Access Enginering)There'r lot of counters. Rich,TkyoAsir,Amsl,Osea.CINV.EXPO,JINS and Tyre.good luck
by wisdom79 Fri Jun 14, 2019 7:55 pm

» NEXT RUN People's leasing and Finance WAIT AND WATCH ENJOY RIDE..
by ddrperera Thu Jun 13, 2019 9:25 pm

» EPF Investment in Unquated copmanies .Who is responsible Previous Centeral Bank Governer and Former Regime.
by Capton KIng Cool Thu Jun 13, 2019 9:05 am

» PDL (Property Development)
by Capton KIng Cool Thu Jun 13, 2019 8:51 am

» EAST Steady at 18
by Cricketman Thu Jun 13, 2019 5:28 am

» Guys what happen these days
by Yahapalanaya Thu Jun 13, 2019 2:29 am

» its right time to buy PHAR@700
by Teller Thu Jun 13, 2019 12:50 am

» Look PAP Amazing company
by Teller Thu Jun 13, 2019 12:46 am

You are not connected. Please login or register

Sri Lanka Equity Forum » Stock Market & Forum Help » Stock Market News » Sri Lanka August inflation seen near record high on drought, rupee

Sri Lanka August inflation seen near record high on drought, rupee

Go down  Message [Page 1 of 1]


Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics
Aug 30, 2012 (LBT) - Sri Lanka's annual inflation rate may have accelerated to near record high of 10.2 percent year-on-year in August as an extended drought pushed up food prices and as a weaker rupee aggravated import bills. The sharp dip in the rupee currency along with higher foodprices drove annual inflation in the $59 billion economy to a 42-month high of 9.8 percent last month.

The rupee has depreciated 16.8 percent since November, making imported inflation a serious threat. The country imports most essential food commodities as well as fuel. Consumer goods accounted for 20 percent of last year's total $20 billion import bill. "We haven't seen an improvement in (food) supply due to the continued drought," one analyst said on condition of anonymity. "The import prices are yet to factored in, though rupee has been more or less flat (in August)."

Food accounts for more than 40 percent of the basket of items used to compile inflation figures. The government has reduced import taxes of selected essential goods since last month and the central bank has said supply shocks will taper off with expected monsoon rains next month.

Central Bank Governor Ajith Nivard Cabraal told Reuters last week that annual inflation in August is unlikely to hit double digits because of steps that have been taken by the government. The International Monetary Fund in its latest staff assessment report ( has said that the current monetary policy stance is appropriate, and a tightening bias should be maintained in the near term until further evidence of diminishing inflation pressures and credit demand emerges.

The central bank in August kept its key policy rates unchanged after raising them twice since February to two-year highs, saying a spike in inflation was due to adverse weather conditions and the resulting disruptions to domestic food supplies.


Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics
Aug 30, 2012 (LBO) - Consumer prices in Sri Lanka's capital Colombo rose 9.5 percent in August 2012, easing slightly from 9.8 percent in July, with the index falling in absolute terms in the month, state statistics office said.

The Colombo Consumer Price Index fell 0.6 percent during the month with the food and non-alcoholic beverages components in the index falling 1.1 percent.
Sri Lanka's inflation accelerated from low single digits after the island's soft-pegged Central Bank, sterilized foreign exchange sales with printed money, worsened a credit bubble and made the rupee fall nearly 18 percent over the past year.

However bank credit is now easing. Past experience has shown that inflation eases as credit slows or contracts following a balance of payments crisis, especially if the exchange rate also strengthens.

Sri Lanka's exchange rate however has not strengthened despite strong capital inflows, because the monetary authority had bought the dollars and created liquidity, preventing a strengthening of the exchange rate.

Analysts have urged the Central Bank to gently sterilize foreign exchange purchases (reversing the cycle that occurs in a balance of payments crisis), and push the exchange rate up to bring inflation down.

The Central Bank has sterilized some of the inflows with the outstanding Treasury bill stock falling by about 20 billion rupees over the past three months indicating that no major demand pressure has been added to the economy by the monetary authority.

Currency depreciation inflates the price of traded goods (imports and exports) and eventually feeds into the non-trade sector.

There are emerging signs that the depreciation is getting entrenched in the price structure of the island and feeding into the non trade sector, which analysts say underlines the urgency for the central bank to strengthen the exchange rate.

Sri Lanka's renewable power producer earlier this week called for higher tariffs to be paid to them by the power utility as capital cost of equipment increased due to currency depreciation.

The central bank has insisted that it can keep inflation below 10 percent by the end of the year.

Back to top  Message [Page 1 of 1]

Permissions in this forum:
You cannot reply to topics in this forum