Consumer price inflation increased to 2.42 percent in mid-January, up from 1.63 percent a month earlier, driven mainly by rising prices of fruits, edible oil and several non-food items.
According to the Current Macroeconomic and Financial Situation Report of Nepal, based on six months of data from fiscal year (FY) 2025/26, year-on-year inflation in mid-January was still significantly lower than in the same period last year, when it stood at 5.41 percent. Average inflation during the first six months of the fiscal year also declined to 1.70 percent from 4.97 percent a year earlier.
During the review period from mid-December to mid-January, food and beverage inflation decreased to 0.09 percent, while non-food and services inflation stood at 3.81 percent. In the corresponding period of FY 2024/25, inflation in these categories had risen by 7.67 percent and 4.19 percent, respectively.
Within the food and beverage group, the year-on-year price index rose by 5.20 percent for fruits, 4.96 percent for ghee and oil, and 3.04 percent for non-alcoholic drinks. In contrast, prices declined for pulses and legumes by 5.52 percent, spices by 3.92 percent, and cereal grains and their products by 3.70 percent.
In the non-food and services category, prices increased sharply for miscellaneous goods and services (21.75 percent), education (7.56 percent), clothes and footwear (5.29 percent), tobacco products (4.15 percent), and alcoholic drinks (3.85 percent). The price index for insurance and financial services, however, decreased slightly by 0.03 percent.
Regionally, inflation rose by 1.99 percent in rural areas and 2.57 percent in urban areas as of mid-January compared to the same period last year. Province-wise, inflation stood at 3.25 percent in Koshi, 3.37 percent in Madhesh, 2.10 percent in Bagmati, 1.76 percent in Gandaki, 2.62 percent in Lumbini, 1.08 percent in Karnali, and 1.27 percent in Sudurpashchim.
In the Kathmandu Valley, inflation was recorded at 2.48 percent, while the Terai, Hill and Mountain regions saw inflation rates of 2.65 percent, 1.94 percent and 2.66 percent, respectively.
