Inflation continues rising

Bhutan is no exception to escalating inflation – that has swept most parts of the world primarily caused by the post-COVID rush and restrictions on the sale of petroleum products from Russia. 

The country’s inflation rate rose to 6.54 percent in the last 12 months as of June, according to National Statistics Bureau (NSB). The NSB’s consumer price index (CPI) shows that inflation crossed 6 percent after four months. Royal Monetary Authority had expected that the inflation rate would not cross 6 percent. 

The prices of non-food items remain the main contributor, at 62 percent, to inflation. However, it has dropped from 71 percent the previous month.

Non-food items contributed 60 percent of the inflation in 2021, primarily contributed to rising fuel prices and in 2020, food prices contributed to 90 percent of the overall inflation because of global food supply chain disruptions.

However, the food prices climbed to 5.13 percent in June from 3.52 percent in May. The contribution to inflation also increased to 38 percent from 29 percent.   

Although the transport sector recorded the highest increase with 14.72 percent, contributing to 33 percent of the inflation, food and alcoholic beverages had the highest contribution with 38 percent of the overall increase.