KATHMANDU, Jan 12: The consumer price inflation stood at 6.05 percent in mid-December 2024, due to excessive hike in prices of food items.
The Current Macroeconomic and Financial Situation Report of Nepal for the first five months of the FY 2024/25 unveiled by Nepal Rastra Bank (NRB) shows that the average market price surged by 0.45 percentage points in one month during mid-November and mid-December. On a year-on-year basis, the inflation rose 1.1 percentage points in the review month from 4.95 percent in the corresponding period of last year.
The escalated inflation was mainly due to the excessive rise in the average price of food and beverages, with the inflation of this segment recorded at 9.99 percent, almost double the value in the corresponding period last year. The price index of vegetables in the group soared 43.05 percent and that of pulses and legumes increased 10.66 percent.
NRB fails to control consumer inflation
Likewise, prices of cereal grains and related products as well as ghee and oil also surged by over nine percent. In contrast, the non-food and service inflation stood at 3.92 percent.
The actual price inflation reported by the NRB is way higher than the target set by the government for the current FY. The government has set a target to maintain consumer price inflation within 5.5 percent for FY 2024/25. Through the first review of monetary policy for the current fiscal year, the NRB last month also talked about maintaining price stability as its main goal.
During the review month, the price index in rural areas increased by 6.52 percent, while it rose by 5.89 percent in urban areas.
Province-wise, consumer price inflation in Koshi Province was 7.36 percent, the largest of all followed by Madhesh Province (6.77 percent), Sudurpaschim Province (6.66 percent), Bagmati Province (5.84 percent), Gandaki Province (4.81 percent), Lumbini Province (5.53 percent) and Karnali Province (4.19 percent).
Region-wise, the mountain areas witnessed the highest inflation of 6.58 percent. In the Terai region, inflation was recorded at 6.31 percent. Inflation in the Kathmandu Valley and hill region stood at 5.82 percent and 5.65 percent, respectively.
