Headline inflation increased to 12.1 percent in December from 9.9 percent in November 2021. On an annual average basis, the CCPI increased to 6.0 percent in December from 5.3 percent in November 2021.
An in-depth analysis of the key drivers of current inflation suggests that a large component of inflation is driven by supply side factors. A detailed explanation in this regard will be published by the Central Bank shortly.
Inflation was driven by monthly increases of prices of items in both Food and Non-food categories. Subsequently, Food inflation (Y-o-Y) increased to 22.1 percent in December 2021 from 17.5 percent in November 2021, while Non-food inflation (Y-o-Y) increased to 7.5 percent in December 2021 from 6.4 percent in November 2021.
The monthly change of CCPI recorded at 2.64 percent in December 2021 due to price increases observed in items of Food and Non-food categories which were 1.80 percent and 0.84 percent.
Prominent increases were observed in prices of vegetables, fresh fish, and green chillies.
Prices of items in the Non-Food category recorded increases mainly due to price increases observed in the Restaurants and Hotels, Transport (Petrol, Diesel, Taxi/three-wheeler charges) and Alcoholic Beverages and Tobacco (Arrack, Cigarettes) sub-categories during the month.
Core inflation (Y-o-Y), which reflects the underlying inflation in the economy, increased to 8.3 percent in December 2021 from 7.0 percent in November 2021.
Annual average core inflation increased to 4.4 percent in December 2021 from 4.0 percent in November 2021.