Inflation hits 14pc, wages up 9 percent

Inflation hits 14pc, wages up 9 percent
ekantipur, 17-Nov-08

Driven by a significant rise in food and beverage prices besides non-food and services, inflation based on consumer price index swelled to 14.1 percent in mid-October 2008 against 6.3 percent during the corresponding period in the previous year.

Inflation was higher in mid-October than in mid-September when prices had gone up by 13.5 percent.

Nepal Rastra Bank (NRB) said in a statement on Monday that inflation had more than doubled in the review period this year as the food and beverage group witnessed a 15.2 percent rise in prices and the non-food and service group went up by 12.9 percent.

Their prices had gone up by 9.5 percent and 2.9 percent respectively during the period last year.

Sugar products became dearer by 39.5 percent while the price of oil and ghee-based products shot up by 35.4 percent. Sugar had gone down by 18.4 percent in the review period last year. Oil and ghee had witnessed a price rise of 12.8 percent.

The price index of transport and communication and building materials soared by 23.1 and 18.3 percent respectively this year against minus 0.5 and 2.5 percent last year.

Core inflation rose to 13.1 percent from 4.7 percent during the review period a year ago, NRB said.

However, the overall wholesale price inflation moderated to 9.3 percent in mid-October this year against 10.3 percent a year ago. The moderation was caused mainly by a decline in the prices of cash crops, fruits and vegetables despite a sharp price rise in imported commodities. This year, the price of agricultural commodities fell by 0.5 percent compared to 14.1 percent last year.

Among imported goods, petroleum products and coal went up 39.4 percent while vehicle and machinery prices increased by 30.4 percent.

With regard to domestic manufactured goods, food-related products and construction materials soared by 21.5 and 18.9 percent respectively. Their prices had risen by 5.9 and 15.5 percent last year.

The overall index of salaries and wages rose by 9.1 percent in the review period this year against 11.9 percent last year.