Headline inflation as measured by the year-on-year change in the National Consumer Price Index (NCPI, 2013=100) decreased to 2.1per cent in June 2019 from 3.5per cent in May 2019due to the high base prevailed in the corresponding month of the previous year. Meanwhile, in June 2019, both year-on-year Food and Non-food inflation decreased to -2.9 per cent and6.2 per centfrom -0.4 per cent and 6.7 per cent respectively.

The change in the NCPI measured on an annual average basis remained unchanged at2.0 per cent in June 2019.

When monthly change is considered, the NCPI increased by 0.4 per cent in June 2019 with the increases observed in the prices of the items in both Food and Non-food categories. Within the Food category, prices of fresh fish, big onions, green chillies, red onions and rice recorded increases. In addition, within the Non-Food category, prices of the items in Transport;and Restaurants and Hotels sub-categories increased during the month.

The external sector remained relatively stable in May 2019 supported by a contracting trade deficit. 

In May 2019, the deficit in the trade account narrowed to US dollars 823 million from US dollars 933 million in May 2018.

The considerable reduction in the trade deficit in May 2019 was due to the decline in import expenditure by 3.9 per cent (year-on-year) and an increase of export earnings by 4.0 per cent (year-on-year). 

Earnings from tourism in May recorded a decline of 70.8 per cent (year-on-year), reflecting the impact of Easter Sunday attacks. However, tourist arrivals in June are expected to have recovered with almost a doubling of the number of arrivals in comparison to May 2019. 

Workers’ remittances amounted to US dollars 562 million in May 2019, recording a decline of 3.1 per cent (year-on-year). On a cumulative basis, workers’ remittances amounted to US dollars 2,733 million during the first five months of 2019.