Sri Lanka’s January inflation at near record high

Updated 01 February 2013

Sri Lanka’s January inflation at near record high

COLOMBO: Sri Lanka’s year-on-year inflation rate in January accelerated to a near record high due to a spike in vegetable prices after floods but the central bank said inflation would start to ease after March, government data showed.
Annual inflation in January hit 9.8 percent, its highest since January 2009 when it hit a record high of 10.4 percent year-on-year under a new index.
It gained from 9.2 percent in December, data released by the Department of Census and Statistics showed.
“This increase is temporary. It is largely due to the increase in vegetable prices due to floods,” Swarna Gunarathne, the central bank’s chief economist, said.
Vegetable prices shot up in January following flash floods in December in the island nation’s major cultivation areas.
Gunarathne said annual inflation would remain about 9 percent until the end of the first quarter due to the high food prices.
The central bank kept policy rates unchanged on Jan. 17, saying it expected inflation to moderate soon.
Gunarathne said easing supply shocks and an improved harvest would bring inflation down to the 7 percent range.
“So there won’t be any immediate changes to rates,” he said.
Annual average inflation, measured on a 12-month moving average, rose to a record high of 8.1 percent, from 7.6 percent in December.


India’s Reliance to push on with retail deal in battle with Amazon

Updated 58 min 36 sec ago

India’s Reliance to push on with retail deal in battle with Amazon

  • The row is the latest development in a prolonged battle for dominance in India between Reliance

MUMBAI: Indian conglomerate Reliance has dismissed Amazon’s push to delay its acquisition of domestic retail giant Future Group, despite an arbitration panel suspending the deal following objections by the US online titan.
The row is the latest development in a prolonged battle for dominance in India between Reliance, owned by Asia’s richest man Mukesh Ambani, and Amazon, whose founder Jeff Bezos is the world’s wealthiest person.
Amazon, which owned a stake in one of Future Group’s firms that reportedly included an option to buy into the flagship company, claims that the $3.4-billion Reliance deal, announced in August, amounted to a breach of contract.
After an arbitration panel ordered the deal to be put on hold following Amazon’s request, Reliance said late Sunday that it would nevertheless “enforce its rights and complete the transaction in terms of the scheme and agreement with Future group without any delay.”
Reliance’s retail subsidiary RRVL said in a statement that it had followed “proper legal advice” before agreeing to buy Future Group, adding that the deal was “fully enforceable under Indian Law.”
Reliance, Amazon and Walmart-backed Flipkart have been locked in a frenzied contest for a share of India’s lucrative online market.
The acquisition of Future Group, which owns some of India’s best-known supermarket brands such as Big Bazaar, would strengthen Reliance’s presence in the hugely competitive e-commerce sector.
The arbitration panel has 90 days to give a final verdict on the Reliance-Future deal.