Sri Lanka inflation hits 54.6-pct in June 2022 after money printing

ECONOMYNEXT – Sri Lanka’s inflation grew 54.6 percent inflation in the 12 months to June 2022, with the central bank driving up consumer prices in the capital Colombo 12.8 percent during the month, official data showed.

The Colombo Consumer Price Index, the most widely watched price gauge rose to 220.2 points from 195.2 points a month earlier after two years of money printing and a collapse of a soft-peg.

Food prices rose 80.1 percent in the 12 months.

Food prices have risen 102.7 percent since February 2020 when aggressive open market operations to create a ‘developmental state’ began.

Sri Lanka operates a highly discretionary monetary regime called ‘flexible inflation targeting’ peddled to the third world by Western Mercantilists where open market operations are unleashed to collapse a reserve collecting peg now labelled a ‘flexible exchange rate’.

Food prices have risen 122 percent from August 2019 when open market operations were unleashed to keep longer bond yields down under ‘flexible inflation targeting’ with ‘output gap targeting’ targeting.

Global inflation is also up after the US Fed printed money claiming inflation was ‘transient’ and it was caused by supply bottlenecks. (Colombo/July01/2022)