THE COST OF LIVING
GOOD NEWS ON TWIN FRONTS
It’s been a long time since perceptions match the official inflation data
The PepperCube Cost of Living Index (CLI) registered a decline in January after a slight increase in the previous month, which followed seven months of continuous decreases. In January, the CLI fell by 2.4 points from the previous month (60.6) to 58.2.
It was as far back as in the second half of 2015 that the index stood at this level.
Likewise, the Colombo Consumer Price Index (CCPI) recorded disinflation once again and it fell further in comparison to December. The CCPI stood at a negative four percent year-on-year in January compared to -1.7 percent in the preceding month.
Meanwhile, respondents’ perceptions have shifted somewhat compared to previous months. Seventy-six percent believe the cost of living has ‘highly’ or ‘moderately escalated’ over the past 12 months – an eight percent decrease from December’s findings.
And 22 percent of the sample population now believe that costs either ‘stayed the same’ or ‘decreased’ in January, which is a seven percent rise from the previous month.
In January, expectations of a ‘highly escalating’ cost of living rose in comparison to the preceding month with 19 percent of polled executives anticipating higher prices over the next 12 months – a slight (3%) increase from the month prior.
Seventeen percent of respondents anticipate a ‘moderate escalation’ in expenses, marking a fall of two points from December. Additionally, four in 10 (40%) expect their spending ‘to remain the same’ – up from 38 percent in December.
Moreover, 15 percent believe the cost of living ‘will decrease’ in the next 12 months.
Nearly half (48%) of the survey participants feel they ‘will not have a chance’ to purchase non-food items over the next 12 months. This is consistent with the preceding month.
And 31 percent expect their expenditure to ‘stay the same,’ reflecting a four percentage point increase from the previous month. In addition, 15 percent are hopeful they will afford non-food products.
