Steep rupee devaluation causes cascading effect on prices of goods and services

The prices of a number of essential items in Sri Lanka increased yesterday (11), following the decision by the government to relax the controls over the value of the rupee.

The rupee depreciated to 260 per U.S. dollar on Thursday (10).

On midnight Thursday (10) Lanka Indian Oil Corporation (LIOC,) the country’s second largest retail fuel distributor, increased the selling price of diesel by 75 Sri Lankan rupees per liter and petrol by 50 rupees per litre.

The All Ceylon Bakery Owners Association also increased the price of a loaf of bread by 30 rupees. The new price of a loaf of bread is between 110 and 130 rupees. The country’s biggest wheat importer. PRIMA increased the price of a kilogram of wheat flour by Rs. 35.

The price of airline tickets was increased by 27%, said Sri Lanka’s Civil Aviation .Authority. (RK)