KATHMANDU, Nov 20: The consumer price index (CPI) in a one-month period between mid-September and mid-October stood at 4.82 percent, an increase of 0.97 percentage points compared to the previous month, mainly due to the increase in food prices triggered by floods and landslides in late September.
The Current Macroeconomic and Financial Situation Report of Nepal for the first three months of the current fiscal year unveiled by Nepal Rastra Bank (NRB) on Tuesday shows that the average price of food and beverage was up by 7.18 percent in the review month. The price index of vegetable sub-category surged 25.15 percent, the largest of all. Likewise, the price index of pulses and legumes rose by 10 percent, cereal grains and their products by 9.57 percent and those of ghee and oil increased by 4.98 percent.
Kamlesh Kumar Agrawal, president of Nepal Chamber of Commerce, said the losses caused by the floods and landslides two months ago resulted in the increase in the prices of food items. According to him, the natural disasters damaged food grains stored in a number of warehouses while adversely affecting the supply chain.
Effect of inflation in Kathmandu Valley: Prices of food and bev...
The NRB records show that the year-on-year CPI in the review month was however remarkably less than 7.50 percent in the same period last year. Similarly, the food price inflation was way too high at 7.18 percent in the review month of fiscal year 2023/24. Compared to food prices, the non-food and service inflation moderated at 3.49 percent this year.
The natural disasters affected the price level in rural areas more than that in the urban areas. According to the NRB report, the CPI in rural areas increased by five percent compared to 4.76 percent in urban areas.
Province wise, Sudurpashchim Province with a price inflation of 6.56 percent recorded the largest rate of inflation among the seven provinces. It was followed by Koshi Province at 6.26 percent and Madhesh Province at 5.08 percent price hikes.
In the review month, the CPI in the Kathmandu Valley, terai, hill and mountain regions surged 4.50 percent, 5.23 percent, 4.32 percent and 5.08 percent, respectively.
Since the commencement of the fiscal year 2024/25, the NRB has adopted the revised measures to estimate the inflation rate. In the revised measures, the weightage of the food and beverage group has been maintained at 45.79 percent, while that of the non-food and services group is kept at 54.21 percent.
The central bank has considered FY 2014/15 as the base year, while it has incorporated 525 goods and services from 87 different markets across 77 districts to estimate inflation.
