𝐈𝐧𝐟𝐥𝐚𝐭𝐢𝐨𝐧 𝐓𝐫𝐞𝐧𝐝𝐬 𝐇𝐢𝐠𝐡𝐥𝐢𝐠𝐡𝐭 𝐆𝐫𝐨𝐰𝐢𝐧𝐠 𝐒𝐭𝐫𝐚𝐢𝐧 𝐎𝐧 𝐃𝐚𝐢𝐥𝐲 𝐋𝐢𝐯𝐢𝐧𝐠

…𝒇𝒂𝒎𝒊𝒍𝒊𝒆𝒔 𝒂𝒏𝒅 𝒓𝒆𝒕𝒂𝒊𝒍𝒆𝒓𝒔 𝒂𝒅𝒋𝒖𝒔𝒕 𝒔𝒑𝒆𝒏𝒅𝒊𝒏𝒈 𝒂𝒔 𝒑𝒓𝒊𝒄𝒆 𝒊𝒏𝒄𝒓𝒆𝒂𝒔𝒆𝒔 𝒄𝒐𝒏𝒕𝒊𝒏𝒖𝒆 𝒏𝒂𝒕𝒊𝒐𝒏𝒘𝒊𝒅𝒆

By Tashi Tshewang

Bhutan’s headline inflation rose to 3.99 percent in October 2025, driven by broad increases in both food and non food prices across the country. Food inflation climbed to 5.65 percent, while non food inflation reached 2.63 percent, pushing national month on month inflation to 0.58 percent. The Capital recorded the highest annual inflation at 5.60 percent, followed by the Western region at 5.54 percent, indicating stronger price pressures in urban and western markets.

Across all major consumer price index regions, including the Central and Eastern areas, year on year inflation hovered around 4 percent. Food prices remained the primary contributor, with items under Food and Non Alcoholic Beverages consistently showing the sharpest increases. In contrast, the Communication index recorded declines in most regions.
Although inflationary pressures intensified in 2025, the annual average inflation for 2024 had eased to 2.82 percent due to slower growth in both food and non food categories. The purchasing power of the Ngultrum continued to weaken, falling to Nu. 53.9 compared with December 2012 prices. This represented a 3.83 percent decline over the past year as rising costs eroded household buying capacity.

These inflation trends are based on price data collected from nearly 500 outlets across all 20 districts. The updated consumer price baskets are derived from the 2022 Bhutan Living Standard Survey, with regional indices published monthly to capture local market movements more accurately.

To understand how rising prices are affecting individuals and businesses, several consumers and retailers shared their experiences. Their accounts reflect the growing pressure inflation is placing on households, small trade operations and local supply chains.

Tshering, a businesswoman from Trongsa, said, “From the supplier’s side, the recent price increase is mainly due to seasonal shortages, weather related disruptions, rising transportation and fuel costs, and a surge in demand. These factors add up and make it difficult for us as retailers to maintain stable prices.”

She added that consumer behavior has also changed, creating additional strain on pricing. “People now prefer fresher, higher quality vegetables, organic or chemical free produce, and convenient home delivery services. With stronger price comparison habits and higher expectations, retailers face increasing challenges in balancing affordability and sustainability.”

According to her, policy support becomes essential when inflation rises. “At times like this, certain policies can really help such as government support for transportation and fuel costs, subsidies for farmers, reduced taxes on perishable products, and better cold storage facilities. With these in place, we can manage prices better and make essentials more affordable for everyone.”

Dhan Bdr Gajmer from Bajo in Wangdue said, “These days, the most difficult things to afford are the basic household ingredients. The prices have gone up so much that it is hard for families like ours to manage. With more people at home and higher costs everywhere, we are facing real financial shortages.”

He added that rising prices of essential food items have placed pressure on daily household budgets. “We really have to use our money carefully now because everything has become so expensive. For businesses too, it is tough. If the taxes were lowered a bit, it would help many of them stay balanced and continue operating without raising prices even more.”

Kuenzang Deki, a vegetable vendor in Thimphu, said, “The main reasons behind the recent price increases from our suppliers are higher transportation and logistics costs. Even the raw materials have become expensive, and currency fluctuations make imported goods costlier. Sometimes customers buy in bulk, sometimes very little, so their buying habits keep changing.”

She explained that unpredictable customer demand forces retailers to source goods from multiple suppliers at varying rates, which raises overall costs. “To keep prices fair for customers, retailers really need support like lower import taxes, stable fuel prices, and better transportation systems. If these areas improve, we can manage our costs better and prevent sudden price hikes.”

Chimi Dolkar, a mother of three from Paro, shared her concerns. “Lately, every trip to the market feels heavier on the wallet. Even basic items like rice, onions, and cooking oil have become noticeably expensive. Earlier, Nu. 1,000 was enough for a week’s vegetables, but now it hardly lasts three or four days. It is becoming very difficult for families like ours who have fixed incomes.”

She said the rising cost of food has forced families to change their shopping habits. “We have to buy smaller quantities, choose cheaper alternatives, or avoid certain items depending on weekly prices. Seasonal changes, transportation costs, and inconsistent supply make planning household budgets even harder.”

She added, “When prices keep increasing like this, we feel the pressure every day. We have to cut down on snacks for kids, reduce eating out, and sometimes postpone buying certain essentials. If the government could regulate market prices better or provide some support during these inflation periods, it would really help families like ours manage without so much stress.”

Kinley Wangmo, another vegetable vendor in Thimphu, said, “We bring our vegetables from India, and the transportation costs as well as taxes on the goods are very high. When the supplier increases prices, we are forced to sell at higher rates just to cover our costs and keep our business running.”

She explained that rising supplier costs and added taxes directly affect retail prices, making it difficult for small businesses to maintain a stable income while keeping goods affordable. These challenges have contributed to the steady increase in vegetable prices observed in the market.

She added, “It feels like prices are going up day by day. As a small business, it is becoming harder to manage, and we worry about both sustaining our livelihood and serving our customers at reasonable prices.”

Rising food and non food prices continue to shape the country’s inflation outlook, with weakening purchasing power and varied pressures across regions. The experiences of families, vendors and small businesses illustrate how higher costs are influencing daily decisions and reshaping spending habits nationwide. As transportation expenses, supply conditions and consumer behaviour drive market changes, discussions on policy support and stabilisation measures remain central to managing the impact on households and retailers in the months ahead.