Crisis-hit Sri Lanka’s inflation hits another record

COLOMBO, Sri Lanka -Crisis-hit Sri Lanka’s inflation hit an eleventh consecutive monthly record in August, official data showed on Wednesday, rising to 64.3 percent as the International Monetary Fund (IMF) extended bailout talks by one more day.

The benchmark year-on-year Colombo Consumer Price Index (CCPI) in August was more than eight times higher than the 7.6 percent recorded in October 2021. Since then it has set a new record high every month.

According to the department of census and statistics, food inflation in August was even higher, hitting 93.7 percent.

Inflation in August was impacted by a more than threefold increase in electricity tariffs and kerosene oil prices that hit in the middle of the month.

The CCPI figures were released hours after the IMF said it had extended by a day official-level talks with the Sri Lankan government on a possible bailout.

“The IMF Mission in Colombo has been extended by one day because discussions are still ongoing with the authorities,” the IMF said in a brief statement.

The IMF had asked Sri Lanka to contain spiraling inflation and address corruption as part of efforts to salvage the troubled economy, which has been ravaged by a foreign exchange crisis.

The Sri Lankan rupee has lost more than 45 percent of its value against the US dollar this year.

An unprecedented economic crisis — which saw the country default on its $51 billion debt in April — forced Gotabaya Rajapaksa to step down as president last month, after prolonged protests against acute shortages of food, fuel and medicines.

The country’s 22 million people have also been enduring lengthy electricity blackouts due to the government’s inability to import enough fuel to run generators.