Inflation goes up by almost 1 per cent

Kathmandu, May 16: Consumer price inflation has increased to 3.8 per cent in mid-April from 2.9 per cent in mid-March this year.

According to the latest report on Current Macroeconomic Report of Nepal by the Nepal Rastra Bank, consumer price inflation was 9.7 per cent in April last year.

The blockade at the southern border had contributed to the shortage of goods in the domestic market thus propelled the inflation to almost double-digit.

“The decline in year-on-year basis inflation compared to the previous year is mainly on the account of the previous year’s base price effect and improved supply situation,” said the central bank.

The very reason caused the food inflation dropped to 0.7 per cent in April this year from 9.3 per cent in the corresponding period of last year.

A fall in price of pulses and legumes by 10 per cent vegetable by 9.7 per cent, ghee and oil by 3 per cent contributed to the fall of the food items.

However, the price of sugar and sugar products increased by almost 14 per cent and alcoholic drinks by 13 per cent in the review period, read the report.

Although significantly moderated as compared to the same period last year, the non-food inflation was 6.3 per cent in mid-April down from 10 per cent last year.

The NRB said that the decline in growth rate of price of cloth and footwear, housing and utilities, communication and transportation, among others contributed to the moderation in non-food inflation in the review period.

According to the NRB, the Hilly region witnessed relatively a higher rate of inflation of 5.6 per cent followed by Terai region, 3.4 per cent, Mountain region, 2.8 per cent, and the Kathmandu Valley, 2.7 per cent in the review period.

Meanwhile, in the current fiscal year 2016/17, merchandise exports increased 12.1 per cent to Rs. 55.22 billion as against a drop of 23.4 per cent in the first nine months of the previous fiscal.

Exports to India, and China and other countries increased by 15.7 per cent and 7.5 per cent respectively.

Export of juice, oil cakes, rosin and increased while export of cardamom, polyster yarn, readymade garments and woolen carpet decreased this year.

Likewise, imports increased by 39.7 per cent to Rs. 726.41 billion in the first nine months of the current fiscal against the drop of 9.9 per cent in the same period last year. The export-import ratio fell to 7.6 per cent this year from 9.5 per cent of previous year.

However, growth rate of remittance inflow has been decreased as compared to previous fiscal.

“The workers’ remittances increased 6.3 per cent to Rs. 511.93 billion in the review period compared to a growth of 13 per cent in the corresponding period of the previous year,” read the report.