Goods and services 8.69% costlier compared to last year

Prices of consumer goods and services increased by 5.32% in February

The increase in food is due to an increase in the price of cooking oil by 36.12%

The Consumer Price Index (CPI) for the month of February 2022 increased by 5.32% compared to the same month the previous year, according to the CPI Bulletin for February 2022 released by the National Statistics Bureau (NSB) recently.

The inflation rate is 0.02% points lower than the rate recorded in the previous month of January, which was 6.03%.

The decrease is mainly associated with the drop in food prices at 0.70% and the rate of non-food prices went up by 0.56 % compared to January this year. 

However, the prices of food are still higher compared to the month of February last year; the increase in food is due to an increase in the prices of cooking oil, sugar, and egg by 36.12%, 34.4%, and 27.15% respectively.

According to the report, non-food prices continue to record a higher increase with 6.37% compared to a 4.10% increase for the food group. Non-food increases accounted for 62% of the overall inflation rate, while the remaining was contributed by food prices.

The non-food prices went up by 0.56% due to an increase in the prices of fuel, including petrol, diesel, and kerosene.

Among the 12 major divisions, transport recorded the highest price increase with 10.06%; mainly associated with fuel price which increased by around 32% on average. It contributed to 27% of the total inflation rate in February. 

In addition, clothing and footwear recorded the second-highest increase with 9.24%, followed by miscellaneous goods and services with 8.28% in February this year.

The month-on-month price decreased by 0.02% (-0.02) due to a drop in the price of food by 0.70%. The decrease in the prices of chili, egg, and other vegetables led to the overall drop over the previous month.

Meanwhile, the prices of household goods and services increased by 7.35% from 2020 to 2021. This was an increase of 1.72 percentage points compared to a 5.63% increase in 2020.

The higher rate in 2021 was due to an increase in non-food by 5.62% compared to a 1.24% increase in 2020. Food prices contributed to about 60% of the overall inflation rate in 2021 and non-food contributed to 40% of the total increase.

In 2020, food prices were the main driver of the inflation rate contributing to almost 90% of the total increase, according to the NSB report.

Among the 12 major divisions, food and alcoholic beverages contributed more than 50% of the total increase in 2021, followed by transport with about 15%, and clothing and footwear with about 11% contribution to the total increase.

Alcoholic beverages and betel-nuts recorded the highest increase with 16.66%, while education fees recorded the lowest increase with 0.66% in 2021. All other divisions recorded an increase except for communication which dropped by 9.90%.

Kinley Yonten from Thimphu