In August 2019, retail prices of most food commodities monitored in 15 major markets across Nepal showed marginal fluctuations as compared to last month, indicating a relatively stable market with smooth supply and transportation services.
The overall inflation rate in August 2019 was 6.9 percent. The food and beverage group was stable at 8.02 percent, although several food sub groups were relatively higher: vegetables (23.4%), fruits (20.2%), spices (13.2%) and meat and fish (10.2%).
In August 2019, retail prices of most food commodities monitored in 15 major markets across Nepal showed a mixed trend (see Fig. 1):
On a month on month basis, retail prices of coarse rice, wheat flour, chicken meat and red potato increased by 1.1, 2.1, 1.0 and 6.4 percent respectively, while those of black gram, broken lentil and soybean oil decreased by 1.5, 2.5, and 0.6 percent respectively.
Compared to three months earlier, most prices indicated an upward trend. The largest change was red potato at +12.3 percent.
On a year on year basis, most prices showed an increasing trend (with the exception of broken lentil and red potato).
The largest change was wheat flour at +17.7 percent.
Factors behind current price trends include seasonal fluctuations and smooth supply with stable transportation services.
Retail prices in regional markets (see Fig. 2) mostly showed a trend similar to national averages. Compared to last month, the price of food commodities mostly showed increased in all markets with the exception of a decreasing trend of coarse rice in the Terai and broken lentil in all markets. Compared to the same period last year, most prices indicated an increasing trend in all markets with the exception of the price of broken lentil in mountain and hill markets.
Wholesale prices monitored in the Kalimati Fruits and Vegetables Market showed relatively high month on month fluctuations (see Table 1): prices of carrot, cabbage, dry onion and cauliflower increased by more than 5 percent due to a reduction in supply relative to demand, while pumpkin, brinjal, bitter gourd, smooth gourd, radish and French bean prices decreased by more than 13 percent due to a surge in supply from the harvest season.
The overall consumer price index (CPI) released by Nepal Rastra Bank was 131.9 in August 2019, an increase of 2.6 percent month on month. The inflation rate, as measured by the year on year increase in the CPI, was 6.9 percent.
The food and beverage group of the CPI was 128.7, an increase of 3.1 percent month on month and 8.02 percent year on year; several sub groups showed relatively high year on year increases: vegetables (23.4%), fruits (20.2%), spices (13.2%) and meat and fish (10.2%). The non food and services group of the CPI was 134.4, an increase of 2.2 percent month on month and 6.1 percent year on year.
The overall supply of food and non food commodities in most markets remains sufficient and stable with smooth transportation services. However, the supply of food commodities in some markets with unpaved roads is limited due to partial the obstruction of roads and transportation services during the monsoon season.
Source: Government of Nepal, World Food Programme