Kathmandu, January 19
The consumer price inflation stood at 6.55 per cent in mid-December compared to 3.71 per cent a year ago, thanks to a significant rise in food and beverage inflation over the month.
As per the country’s macroeconomic statistics of the first five months released by Nepal Rastra Bank (NRB) today, the food and beverage inflation stood at 9.76 per cent, thus creating a pressure on inflation.
The central bank’s report states that prices of vegetables, spices, fruits and pulses and legumes rose significantly in the review month. Likewise, within the non-food and service group, the price of education, clothes and footwear, and furnishing and household equipment subgroups rose moderately in the review month.
Earlier in mid-August, inflation stood at an almost three-year-high of 6.95 per cent following a sharp hike in food prices. It was the first time consumer prices had shot up to this level since September 2016. It is doubtful that the government will be able to meet its target of containing annual inflation at six per cent for this fiscal year if inflation keeps rising in this manner.
Meanwhile, the central bank statistics show that merchandise exports increased by 27 per cent to Rs 47.62 billion in the first five months in the ongoing fiscal year compared to an increase of 12.7 per cent during the same period a year ago. However, merchandise imports decreased 4.2 per cent to Rs 581.26 billion against an increase of 34.2 per cent in the same period of the previous year.
As a result, the total trade deficit narrowed down 6.3 per cent to Rs 533.64 billion in the five months of 2019- 20 though such deficit had expanded 36 per cent in the same period of the previous year.
Similarly, the remittance inflow which had been falling till mid-November increased by 0.1 per cent to Rs 376.99 billion in the review period compared to 31.9 per cent in the same period of the previous year.
However, the current account registered a deficit of Rs 70.32 billion in the review period. Such deficit stood at Rs 119.33 billion in the same period of the previous year.
However, balance of payments (BoP) remained at a surplus of Rs 23.3 billion in the review period against a deficit of Rs 85.32 billion in the same period of the previous year.