NCPI based headline inflation hits 66.7% in July

The Department of Census and Statistics (DSC) has released the National Consumer Price Index (NCPI) and the inflation rate for the month of July 2022.

The overall rate of inflation as measured by the NCPI on Year-on-Year basis for the month of July 2022 has been reported as 66.7%, according to the department.

The NCPI for all items for the month of July 2022 is 244.4 and it records an increase of 12.9 in index points compared to the June 2022. 

The overall rate of inflation as measured by NCPI on Year-on-Year basis is 66.7% in July 2022 and the moving average inflation for the month of July 2022 is 25.9%.

The NCPI is a macroeconomic indicator compiled to measure inflation which is defined as a sustained increase in the general level of prices for goods and services and it is measured as an annual percentage increase by NCPI. 

Inflation can be measured in two ways. One measure is the Year-on-Year base or Point- to-Point inflation (The percentage change in the current month CPI over same month CPI of last year). 

The other measure is Moving Average Inflation (The percentage difference between the average Price Indices of last 12 months & the average Price Indices of previous 12 months).

Year-on-Year Inflation 

The overall rate of inflation as measured by NCPI on Year-on-Year basis is 66.7% in July 2022 and inflation calculated for the June 2022 was 58.9%. With respect to July 2021, the reported inflation for the month of July 2022 was mainly due to the higher price levels prevailed in both food and non-food groups. Accordingly, the Year-on-Year inflation of the food group increased to 82.5% in July 2022 from 75.8% in June 2022 and the Year-on-Year inflation of the non-food group increased to 52.4% in July 2022 from 43.6% in June 2022. 

Contribution to Year-on-Year inflation: 

On Year-on-Year basis, contribution of food commodities to inflation was 39.28 percent in July 2022 compared to the month of July 2021.

Contribution of non-food items was 27.44 percent. This was mainly due to price increases in groups of items ‘Transport’ (10.10%), `Housing, Water, Electricity, Gas and Other fuels’ (3.61%), ‘Restaurant and Hotels’ (3.04%), ‘Furnishing, Household equipment and Routine household maintenance’ (2.37%), ‘Miscellaneous goods and services’ (2.19%), ‘Alcoholic beverages, Tobacco and Narcotics’ (1.54%), ‘Health’ (1.74%), ‘Clothing and Footwear’ (1.34%), ‘Education’ (0.81%), ‘Recreation and Culture’ (0.59%) and `Communication’ (0.12%) during the period.