INFLATION BELIES COSTS!

Inflation’s oscillations mirror the multifaceted nature of consumer realities

The PepperCube Cost of Living Index (CLI) saw an ever so slight increase in April, following two months of decline. Having begun the year on high ground, the index experienced two consecutive falls, only to edge up by 0.1 percent: it rose from 91.9 in March to 92 in April.

In contrast, the Colombo Consumer Price Index (CCPI) witnessed another shift in inflation in April, rebounding to 1.5 percent after dropping to 0.9 percent in March. This is the second instance of inflation falling to 1.5 percent since October last year, which marked the onset of the rapid decline of the CCPI.

A majority of respondents (97%) say they believe the cost of living has risen either ‘highly’ or ‘moderately’ over the past 12 months. This is consistent with the findings in the previous month.

Meanwhile, a mere three percent of respondents feel that costs ‘stayed the same,’ reflecting a one percentage point increase from March.

Regarding expectations for the next 12 months, sentiment about a ‘highly escalating’ cost of living saw a slight improvement in April. Nearly two-thirds (64%) of executives express this belief, marking a decrease from the preceding month’s outcome.

Additionally, close to a quarter (24%) of respondents foresee a ‘moderate escalation,’ which is a three-point rise. And seven percent expect costs to remain unchanged while two percent hold an optimistic view of a slight ‘decrease’ in their expenditure outlays.

However, the predominant sentiment among poll participants (86%) remains pessimistic, believing they ‘will not have a chance’ to purchase non-food items in the next 12 months – mirroring the proportions reported in the previous month’s poll.

Furthermore, nine percent anticipate no change in the cost of living while only two percent have a slight hope of being able to purchase non-food items.

– LMD

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.