THE COST OF LIVING
MIXED PERCEPTIONS PERSIST
Perceptions about the cost of living continue to be mixed despite disinflation
The PepperCube Cost of Living Index (CLI) has dropped for the seventh consecutive month, hitting its lowest point since the fourth quarter of 2015 – a trend that may continue in the months ahead.
The CLI saw a slight decrease of 0.2 points from the previous month (59.6), to register 59.4 in November – its lowest level this year.
Additionally, the Colombo Consumer Price Index (CCPI) recorded disinflation once again with the index falling to -2.1 percent year-on-year in November – from -0.8 percent in the preceding month.
In contrast however, respondents’ perceptions have remained unchanged compared to the previous month. Eighty-seven percent believe the cost of living has ‘highly’ or ‘moderately escalated’ over the past 12 months, which is consistent with October’s findings.
Meanwhile, 13 percent of the sample group feel that costs either ‘stayed the same’ or ‘decreased’ in November, as in the previous month.
In November, expectations of a ‘highly escalating’ cost of living waned with far fewer than one in five (15%) of polled executives anticipating higher prices over the next 12 months – marking a five percent decline from the month prior.
And 18 percent of respondents anticipate a ‘moderate escalation’ in their expenses, which is a two point increase from October. Additionally, over a third (35%) expect their spending ‘to remain the same’ – up from 27 percent in the preceding month.
On the other hand, 25 percent believe the cost of living ‘will decrease’ in the next 12 months.
Despite these mixed expectations, 45 percent of survey participants remain pessimistic, believing they ‘will not have a chance’ to purchase non-food items over the next 12 months – this marks a two point rise from October.
Furthermore, 30 percent of respondents expect their living expenses to ‘stay the same,’ reflecting a four point spike from the previous month. However, nearly two in 10 (19%) are optimistic about their ability to afford non-food products.
