Price hike starts to cool down

The price hike that has zoomed up last year has started to cool down.
According to Nepal Rastra Bank (NRB), the year-on-year (y-o-y) inflation -- as measured by the consumer price index -- moderated to 9.3 per cent in Mid-October 2009 against 14.1 per cent in the same period last year.
The food and beverage group -- especially Vegetables, sugar and sugar related products -- have become more expensive than last year.
Sugar and sugar related products have become more expensive as it increased by a whopping rate of 42 per cent in compared to an increase of 39.5 per cent in the same period last year. Similarly, the price indices of vegetables and fruits increased by 37.5 per cent in sharp contrast to last year's decline of 10.1 per cent.
Similarly, the price indices of pulses as well as meat, fish and eggs sub-groups also increased by 25.1 per cent and 22.7 per cent respectively compared to an increase of 24.7 per cent and 22 per cent in the same period last year, said the NRB.
Though, the prices of food and beverages have not come down, the prices of non-food and services group came down by over six times. “The price index of food and beverages group increased by 15.6 er cent but the index of non-food and services group rose only by two per cent,” said the central bank said adding that the index of food and beverages and non-food and services group had risen by 15.2 per cent and 12.9 per cent respectively in the first three months of last fiscal year.
Within the group of non-food and services, the index of tobacco and related products rose up by 17 per cent against to a rise of 12.7 per cent during the same period last year. However, the price index of transport and communication declined by 8.7 per cent in comparison to an increase of 23.1 per cent during the same period last year.
Surprisingly, the prices in Kathmandu Valley, Tarai and Hills have moderated as the price index of Kathmandu Valley rose by 9.7 per cent and followed by 9.4 per cent in Tarai and 8.5 per cent in Hills against 14.5 per cent, 14 per cent and 13.9 per cent last year.
The y-o-y core inflation also moderated to 10.9 per cent from 13.1 percent a year ago, the central bank’s data revealed.
Similarly, the salary and wage rate index also rose by more than a double to 22.1 per cent in comparison to a rise of nine per cent a year ago. “The increase in basic salary and allowances of civil servants and its simultaneous effect on salary of the private sector contributed to such an increase in salary index,” concluded the NRB report.