THE COST OF LIVING
CHRONICLES OF ‘INFLATION’
The saga of two inflation tracking indices continues to test our analyses!
The seesawing PepperCube Cost of Living Index (CLI) is back in full swing – it shifted gears in October from the previous month. The CLI decreased to 88.47 basis points from 89.62 in September, marking a fall of 1.15 points. Following a temporary spike, the index has resumed the downward trend observed in July and August.
In fact, the index has registered a continuous decline, breaking a trend of consistently being above the 90 point mark for 13 months since March 2022, including May and June this year.
Simultaneously, the Colombo Consumer Price Index (CCPI) recorded a 0.2 spike but maintained its single digit trend for the fourth consecutive month – the CCPI rose from 1.3 percent to 1.5 percent in October.
Despite the notable deceleration in inflation over the past few months, public sentiment vis-à-vis the cost of living among surveyed executives doesn’t appear to be abating.
In the latest poll conducted by PepperCube, 94 percent of respondents say they feel the cost of living has risen ‘highly’ or moderately’ over the past 12 months. Five percent believe that the cost of living remains the ‘same as before.’
Sixty percent of executives anticipate the cost of living to ‘highly escalate’ while nearly a quarter (24%) of the sample population expect inflation to ‘moderately escalate.’
Meanwhile, slightly over one in 10 (11%) of polled participants feel that the cost of living ‘will remain the same’ with two percent expressing hope that it’ll ‘decrease.’
The expectations of 79 percent of respondents remain negative as they believe they ‘will not have a chance’ to purchase non-food items in the 12 months ahead.
Fourteen percent on the other hand, anticipate the cost of living to remain the same while two percent are hopeful of having a ‘slight chance’ to purchase non-food items.
FOOTNOTE An index based on a monthly survey, the CLI aims to measure and understand perceptions regarding the cost of living as opposed to reported or official inflation.
