Bhutan’s an­nual in­fla­tion rate was up by 3.1 per­cent in the year 2014

Bhutan Times - - Home - Sonam Pen­jor

Bhutan’s an­nual in­fla­tion for the quar­ter end­ing June 2014 was recorded at 8.6 per­cent, up by 3.1 per­cent­age points, against 5.5 per­cent in 2013 (year-on-year), ac­cord­ing to an­nual re­port 20132014 of Royal Mon­e­tary Author­ity of Bhutan.

The re­port also high­lighted that, the rise in prices of food items has mainly con­trib­uted to the in­crease of the con­sumer price in­dex (CPI) in the quar­ter end­ing June 2014.

The sig­nif­i­cant in­crease in the prices of food com­modi­ties was reg­is­tered at 12.3 per­cent in quar­ter 2 (Q2) in 2014, com­pared to 2.8 per­cent dur­ing the same quar­ter last year. How­ever, the prices of non-food items de­creased by 6.1 per­cent dur­ing the sec­ond quar­ter of 2014 com­pared to 7.1 per­cent last year, the re­port states.

The re­port fur­ther states that, while the over­all monthly CPI (year-on-year) recorded to 8.1 per­cent in­crease in June 2014, of which prices of im­ported goods in­creased by 7 per­cent, while do­mes­tic goods and ser­vices in­creased by 9.4 per­cent.

Be­sides that, the per­cent­age weights to the over­all in­fla­tion from im­ported goods ac­counted for 52.6 per­cent while do­mes­tic goods and ser­vices ac­counted to 47.4 per­cent for June 2014, the re­port states.

The re­port also states that, dur­ing June 2014, un­der food items, which con­sti­tute 39.9 per­cent of the over­all weight as­signed in the com­mod­ity bas­ket, nar­cotics saw the high­est year-on-year in­crease in prices by 26.7 per­cent fol­lowed by fish 17.4 per­cent; cof­fee, tea and co­coa 14.1 per­cent; wine 13.9 per­cent; food prod­ucts n.e.c 13.7 per­cent; meat 13.7 per­cent; veg­eta­bles 13.2 per­cent; fruit 12.7 per­cent; bread and ce­re­als 12 per­cent; milk, cheese and eggs 11.2 per­cent; oils and fats 9.6 per­cent.

Mod­er­ate price in­creases were noted for beer at 6.2 per­cent; spir­its at 3.7 per­cent; and sugar, jam, honey etc. at 2.4 per­cent. How­ever, down­ward price move­ments in the food group came from a fall in the prices of min­eral wa­ter, soft drinks and juice prod­ucts by 0.1 per­cent, states that re­port.

Ac­cord­ing to the an­nual re­port, for non-food items, the high­est yearon-year in­crease in prices was recorded for elec­tric- ity, gas and other fu­els at 14.3 per­cent fol­lowed by glass­ware, table­ware and uten­sils at 12.2 per­cent; fur­ni­ture and fur­nish­ing, car­pets and other floor at 11.4 per­cent; house­hold tex­tiles at 3.9 per­cent; house­hold rental at 9.53 per­cent; ac­com­mo­da­tion ser­vices and per­sonal care at 7.2 per­cent each; and footwear at 3 per­cent.

Be­sides that re­port also shows that, other non-food items noted mod­er­ate price in­creases ex­cept for tools and equip­ments for house and gar­den; tele­phone and tele­fax equip­ment; recre­ational and cul­tural ser­vices which recorded neg­a­tive growth dur­ing June 2014.

While the pur­chas­ing power of ngul­trum (PPN), as mea­sured by CPI, recorded 87 ngul­trum as of June 2014. This im­plies that ngul­trum 100 in June 2014 was worth only ngul- trum 87 at De­cem­ber 2012 price, which shows that, the value of ngul­trum had de­pre­ci­ated by 13 per­cent in the past 12 months due to in­crease of prices in the econ­omy.

As of June 2014, the re­ports shows that over­all pro­ducer price in­dex in­fla­tion (PPI) had grown up by 3.6 per­cent com­pared to June of the pre­vi­ous year, due to the in­crease in prices mainly con­trib­uted by man­u­fac­tur­ing sec­tor by 5 per­cent and min­ing sec­tor by 2.5 per­cent and trans­port sec­tor by 1.2 per­cent.

Mean­while, re­port shows that prices for elec­tric­ity and wa­ter sup­ply recorded a con­stant in­crease of 2.9 per­cent and 4.6 per­cent re­spec­tively in three months (2014). While there was a de­crease in in­for­ma­tion and com­mu­ni­ca­tion sec­tor due to re­duc­tion in the rates of in­ter­net leased lines.

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