Consumer price inflation increases to 3.9 per cent in mid-November

BOP

Kathmandu: Consumer price inflation (CPI) has accelerated to 3.9 per cent in mid-November 2017 from 3.1 per cent in mid-October 2017.

The increment in the prices of vegetables, alcoholic drinks, among others, has contributed to the acceleration of inflation during the review month, according to current macroeconomic and financial report issued by Nepal Rastra Bank (NRB).

Food inflation has moderated to 2.3 per cent in mid-November 2017 from 2.6 per cent in the corresponding month of the previous year.

A fall in prices of pulses and legume by 24.1 per cent and spice by 5.5 per cent contributed to the moderation in overall food inflation. However, food inflation increased by 1.3 per cent in review month over last month on account of rise in price of vegetable by 9.6 per cent during that month.

Non-food inflation moderated to 5.1 per cent during the review month from 6.5 per cent in the corresponding month of the previous year. The slower growth of prices of clothes and footwear, furnishing and household equipment, housing and utilities, health, among others, contributed to the moderation of non-food inflation in the review period.

The mountain region witnessed relatively a higher rate of inflation of 5.4 per cent followed by hilly region of 4.7 per cent, Terai region of 3.7 per cent and the Kathmandu Valley of 3.2 per cent in the review period.

During the review period, higher inflation observed in Chandannath market centre (Jumla) caused a higher rate of inflation in mountain region.

The year-on-year (y-o-y) consumer price inflation was 3.9 per cent in Nepal in mid-November 2017 compared to 4.9 per cent in India, showing an inflation wedge of 1 per cent between the two countries.

A significant fall in prices of pulses and legumes was the factor for a lower level of inflation in Nepal relative to India during the review month.

The y-o-y wholesale price inflation eased to 0.8 per cent in the review month from 4.1 per cent a year ago. The wholesale price indices of agricultural commodities declined by 0.3 per cent where as domestic manufactured commodities and imported commodities grew 4.1 per cent and 1.3 per cent respectively in the review period.

The y-o-y growth in salary and wage rate index moderated to 6 per cent in the review period from 14.4 per cent in the corresponding period of the previous year.

In the review period, the salary index increased by 9.5 per cent, while the wage rate index grew by 5.1 per cent. The growth in salary indices of bank and financial institutions, education and public corporations sub-groups was 10.6 per cent, 5.8 per cent and 0.8 per cent respectively in the review period.

Likewise, wage rate indices of agricultural laborer, industrial laborer and construction laborer witnessed a growth of 4.8 per cent, 6.6 per cent and 3.2 per cent respectively in the review period.