Sri Lanka inflation rises to 60.8% in July as dollar crunch persists

Transport costs surge 143.6%, while food prices have increased 90.9%

Sri Lanka’s headline inflation surged to a record in July as food and fuel remained scarce amid depleted foreign exchange reserves.
 
Official data on Friday showed consumer prices in the capital Colombo rose 60.8 per cent from a year ago. That compares with the 62 per cent jump from a median estimate by three economists in a Bloomberg survey.
 
Transport costs rose 143.6 per cent, while food prices increased 90.9 per cent, the data showed.
 
Prices are still soaring even as economic activity has almost ground to a halt amid nationwide rationing of fuel and power outages against the backdrop of political turbulence. The uncertainty risks delaying the bailout from the International Monetary Fund and friendly nations crucial to the island nation alleviating shortages of fuel, food and medicines.
 
The country’s central bank has raised borrowing costs by 950 basis points this year and earlier this month warned inflation may hit 70 per cent. The next monetary review is scheduled on 18 August.
 
President Ranil Wickremesinghe has initiated negotiations with the Opposition parties to persuade them to join an all-party government led by him as part of his efforts to establish trust.