Price starts looking up

Price hike has become a serious concern as it has not seen cooling down.

According to the central bank, the year on year (y-o-y) inflation -- as measured by the consumer price index -- recorded an increase of 12 per cent in Mid-February (seventh month of the current fiscal year) compared with the 13.7 per cent increase in the same period last year. It had recorded 11.8 per cent increase in mid-January (sixth month of the current fiscal year).

Propelled by the items in the food and beverage group, price indices of sugar and sugar related products -- that saw almost double and the highest increase of 77.6 per cent compared with an increase of 46.7 per cent in the same period last year -- the price hike continued to look upward, said the Nepal Rastra Bank (NRB).

Similarly, some of the items saw four fold increase in a year. "The price indices of spices, pulses, meat, fish and eggs as well as vegetables and fruits sub-groups increased in reviewed period by 36.7 per cent, 36.4 per cent, 22.7 per cent and 18.8 per cent respectively compared to an increase of 9.4 per cent, 26.5 per cent, 22.9 per cent and 19.4 per cent in the same period last year," the report added.

However, the grains and cereal products prices came a little down. "The index of grains and cereal products subgroup also witnessed an increment of 13 per cent compared to 14.7 per cent increase in the corresponding period of last year," according to the central bank's monthly price index. "Similarly, the price index of food and beverages group increased by 17.8 per cent whereas the index of non-food and services group rose only by 5.3 per cent. The index of food and beverages and non-food and services group had risen by 18.1 per cent and 9.1 per cent respectively in the same period last year."

Region-wise, the price index of Hills rose by 13 per cent and followed by 12.3 per cent in Terai and 10.8 per cent in Kathmandu Valley compared with 13.2 per cent, 13.8 per cent and 13.9 per cent same period last year.

Though the y-o-y wholesale price inflation increased by 14.2 per cent compared to 15 per cent a year ago, the indices of agricultural commodities and domestic manufactured commodities increased by 25 per cent and 11.2 per cent against to 18.8 per cent and 11.2 per cent a year ago. "Within the agricultural commodities group, the price index of pulses, livestock production and spices increased by 36.4 per cent, 35.2 per cent and 33.8 per cent compared with an increase of 19 per cent, 24 per cent and 10.3 per cent during the same period last year," it said.

Surprisingly, the price index of imported commodities declined by 0.5 per cent in the review period whereas it had increased by 11.8 per cent during the same period of last year.

Within the group of domestic manufactured commodities, the price index of food-related products increased by 18.9 per cent compared with a rise of 11.8 per cent a year ago.

However, the overall y-o-y salary and wage rate index rose by 16.7 per cent compared with a rise of 16.5 per cent a year ago. Similarly, the wage rate index also increased by 17.6 per cent compared with an increase of 16.4 per cent in the same period last year.

The wages of industrial labour increased by almost double. "Wages of agricultural, industrial and construction laborers increased by 20.7 per cent, 13.8 per cent and 12.9 per cent respectively in the review period. These wage rates had increased by 23 per cent, seven per cent and 15.3 per cent respectively in the same period last year," said the central bank.

The rising trend

Seventh month -- 12 per cent

Sixth Month -- 11.8 per cent

Fifth Month -- 11.3 per cent

First six months average -- 10.1 per cent.

Government target -- seven per cent