Inflation Surges- CPI Rises by 4.60% in November 2023

…𝐭𝐡𝐞 𝐩𝐫𝐢𝐜𝐞𝐬 𝐢𝐧𝐜𝐫𝐞𝐚𝐬𝐞𝐝 𝐟𝐨𝐫 𝐛𝐨𝐭𝐡 𝐟𝐨𝐨𝐝 𝐚𝐧𝐝 𝐧𝐨𝐧-𝐟𝐨𝐨𝐝, 𝐛𝐲 𝟓.𝟐𝟏 𝐩𝐞𝐫𝐜𝐞𝐧𝐭 𝐚𝐧𝐝 𝟒.𝟎𝟗 𝐩𝐞𝐫𝐜𝐞𝐧𝐭 𝐫𝐞𝐬𝐩𝐞𝐜𝐭𝐢𝐯𝐞𝐥𝐲

Phurpa Wangmo

In a recent report released by the National Statistics Bureau on the Consumer Price Index (CPI), it was revealed that the index surged by 4.60 percent in November 2023 compared to the same period last year. The increase was widespread, affecting both food and non-food items, with respective spikes of 5.21 percent and 4.09 percent.

Among the twelve major divisions, all experienced price hikes except for transport and communication, which saw a decline of 0.99 percent and 2.86 percent, respectively. Notably, housing and utilities witnessed a substantial increase of 9.51 percent. Alcoholic beverages and betel nuts saw a rise of 5.81 percent, while food and non-alcoholic beverages increased by 5.16 percent.

The month-on-month CPI for November 2023 rose by 0.21 percent from October 2023. Food prices increased by 1.08 percent, whereas non-food items experienced a decrease of 0.52 percent. Compared to the previous month, the prices for transport decreased by 1.71 percent, and housing and utilities saw a minor decrease of 0.1 percent. Food and non-alcoholic beverages increased by 1.16 percent, while alcoholic beverages and betel nuts saw a marginal rise of 0.1 percent.

The year 2022 witnessed a 5.64 percent increase in the prices of household goods and services, signaling a notable decline from the 7.35 percent surge observed in 2021. This downturn of 1.71 percentage points was primarily attributed to the moderation in the rate of food price escalation, which stood at 3.95 percent in 2022 compared to a more pronounced 9.38 percent in the preceding year. Food items maintained their significance, constituting approximately 34 percent of the overall inflation rate in 2022, while non-food items accounted for the remaining 66 percent. In contrast, 2021 saw food prices as the primary catalyst for inflation, contributing nearly 60 percent to the overall increase.

Among the twelve major divisions, the noteworthy contributors to the inflation rate in 2022 were food and alcoholic beverages, making up over 33 percent of the total increase, followed closely by transport at approximately 33 percent, and clothing and footwear, contributing around 13 percent to the overall uptick. Transport emerged as the division with the highest increase in 2022, recording a surge of 12.59 percent, while alcoholic beverages and betel nuts experienced the lowest increase at 1.16 percent. With the exception of communication, which witnessed a decrease of 1.46 percent, all other divisions displayed an upward trajectory in prices, underlining the complex dynamics influencing the overall inflation landscape.

The purchasing power of Ngultrum, as measured by CPI, is now Nu. 56.7 as of November 2023 compared to December 2012. This indicates that Nu. 100 in November 2023 is equivalent to only Nu. 56.7 in December 2012 prices. Over the last year, from November 2022 to November 2023, the Purchasing Power of Ngultrum has declined by 4.40 percent due to the overall price increases in the economy.

The Consumer Price Index (CPI) serves as a metric to measure the average price changes in the basket of goods and services purchased by households over time. It provides insights into how much, on average, prices of goods and services have increased or decreased from a specific reference period, commonly known as the Index reference.