Nepal’s consumer price inflation reached 5.60% in mid-November, exceeding the government’s annual target of 5% for the fiscal year 2024/25, according to the Nepal Rastra Bank’s (NRB) Macroeconomic and Financial Situation Report. Inflation rose by 0.78 percentage points between mid-October and mid-November and by 0.22 percentage points year-on-year compared to 5.38% in the same period last year.
The spike in inflation was primarily driven by rising food prices. The year-on-year price index of vegetables surged by 33.99%, pulses and legumes by 10.78%, cereal grains and their products by 10.15%, and ghee and oil by 9.29%.
Natural disasters in September severely disrupted food supplies, damaging stored grains and supply chains. Despite the ongoing harvest season, traders have not significantly reduced prices. “Vegetables now cost over Rs 100 per kg, double last year’s prices during the same season,” said Sugam Basnet, a shopper at a Dhumbarahi market.
In the non-food category, prices of miscellaneous goods and services rose by 10.41%, alcoholic drinks by 6.35%, clothing and footwear by 4.57%, and tobacco products by 4.24%.
Inflation was higher in rural areas (6.19%) compared to urban areas (5.39%), with the mountain region experiencing the largest increase at 6.78%. Among provinces, Koshi reported the highest inflation at 7.19%, followed by Sudurpashchim (6.57%), Madhesh (5.72%), and Bagmati (5.35%).
The NRB estimates inflation using a basket of 525 goods and services from 87 markets across 77 districts, with FY 2014/15 as the base year.
