Bhutan Records Lowest Inflation Rate In 2018 At 3.13 Percent

Email

For the measurement of the current Consumer Price Index, prices are collected from a sample of 557 outlets.

At the Thimphu Weekend Food Market. (Source: Helsand Christian)

 

By Tshering Palden | Kuensel

Bhutan recorded the lowest inflation rate since the National Statistics Bureau (NSB) began its tracking 15 years ago.

The Consumer Price Index (CPI) or the inflation rate from December 2017 to December 2018, increased by 3.13 percent, up by 0.04 percentage point.

Further statistical breakdown of the Consumer Price Index

The increase in rate is mainly due to increase in food prices by 3.87 percent while non-food prices dropped by 0.11 percentage point to 2.65 percent as compared to 2.76 percent in November.

Local goods and services recorded higher increase with 3.24 percent compared to imported goods and services which increased by 3.03 percent.

Food prices (for both local and imported) recorded higher increase compared to the non-food group which increased by 2.65 percent.

However, local food prices increased by 4.26 percent as compared to 3.55 percent for imported food prices.

The CPI for December 2018 over the previous month of November went up by 0.39 percent which is 0.13 percentage point higher.

The increase is mostly fueled by food prices which rose 1.38 percent while prices dropped by 0.26 percent for non-food items, triggered by the decrease in prices of fuel.

Local goods and services increased by 0.75 percent while imported goods went up by 0.05 percent.

The NSB quoted the increase in prices of vegetables for the increasing CPI for local goods while the drop in fuel prices within this month has held the increase for imported goods to 0.05 percent although food prices recorded 0.89 percent increase.

The purchasing power of ngultrum (PPN), as measured by the CPI, had dropped from Nu 75 in January to Nu 73 in December. This means, Ngultrum 100 in December 2018 is worth only Ngultrum 73 at December 2012 prices, which was the reference period.

 

Inflation rate from Jan-Dec 2018

Photo: Kuensel

 

The PPN has decreased by 3.04 percent in the past 12 months due to price increase in the economy.

How is the Consumer Price Index derived?

The CPI shows how much, on average, the prices of goods and services have increased or decreased from a particular reference period, commonly known as the base period, which in this case is 2012.

The index considers 151 items (436 varieties) or sample of goods and services representative of all goods and services purchased by typical households in Bhutan.

Sample outlets are permanent establishments or retail shops from which the monthly price of goods and services are collected or quoted. These include groceries, clothing and footwear, restaurants, hardware shops, vegetable vendors and service providers etc.

The CPI is one of the major indicators that determine the effectiveness of an economic policy.

For the measurement of the current CPI, prices are collected from a sample of 557 outlets. It is used to formulate fiscal and monetary policies and monitor their effect on the overall economy.

 

This article first appeared in Kuensel and has been edited for Daily Bhutan.

 


Related Posts

Bhutan Expects Record Low Inflation In 2018

The nine-month average inflation rate this year was recorded at 2.61 percent, the lowest figure since 2004.

Dec 09, 2018 11:47

Fuel Price Cut Leads to Reduction in Consumer Price Index

“Drukair is passing on savings to consumers derived as a result of lower fuel prices with airfare reduction starting...

Mar 31, 2018 17:49

Asian Development Bank: Bhutan Among Fastest Growing Economies In...

In 2018, Bhutan’s GDP is projected to grow by 7.1 percent, the second highest growth after India (7.3 percent).

Jul 10, 2018 18:48

Bhutan’s National Revenue Records 24 Percent Growth

According to the provisional revenue report 2017-18, tax revenue increased to Nu 27.10B, an increase of 25 percent from...

Nov 23, 2018 12:05

Fuel Price Drop to Spur Economic Growth by 1%

“The drop in the prices will stimulate the economy by lowering the cost of transportation, resulting in a drop in prices...

Nov 27, 2017 10:48

Prices of Essential Commodities Remain Almost the Same Post-GST

The effect of Goods and Services Tax (GST) implemented from July 1 last year by India is yet to be felt on essential...

Apr 06, 2018 21:26

Latest

News

Their Majesties, Prime Minister Dr. Lotay Tshering And Other Dignitaries Of Bhutan Offered Prayers For Sri Lanka

His Majesty also sent a message of condolence to the President of Sri Lanka, Maithripala Sirisena, expressing the solidarity of the people...

Apr 24, 2019 20:08

WFP Shifts Focus To Capacity Development In Nutrition And Disaster Preparedness In Bhutan

The decision was made after consultations with Bhutan's government, in line with the UN Sustainable Development Goals

Apr 19, 2019 13:02

Features

Addressing Some Challenges As Bhutan Prepares For Rise In Tourist Arrivals

The gross receipt from tourism is expected to increase from Nu 10.6 billion in 2018 to about Nu 39.16 billion in the next five years.

Apr 23, 2019 17:40

How Bhutan Has Changed Me: Julie Chapman

Julie Chapman, who is from the California, speaks about how life was like for her while living in Bhutan.

Apr 18, 2019 10:20

Sports

Bhutan To Hold First 'Sports And Culture Festival' For Runners And Cyclists

There are two tiers to the event, comprising of a full-race distance of 50km and a half-race of 25km.

Mar 06, 2019 17:14

Bhutan’s HRH Princess Eeuphelma Choden Wangchuck Attended The General Assembly of the Asian Paralympic Committee In Dubai

The General Assembly is the highest decision making body of the Asian Paralympic Movement.

Feb 08, 2019 18:15

Business

Celebrating Bhutan's Entrepreneurs: Kinley Dema Of BuBu Bakery, Lobesa

This story is part of an exclusive feature by Yeewong Magazine in Dec 2018 on celebrating entrepreneurship in Bhutan.

Apr 20, 2019 19:18

Celebrating Bhutan's Entrepreneurs: Sonam Choden of Rolling Pin Bakery in Thimphu

This story is part of an exclusive feature by Yeewong Magazine in Dec 2018 on celebrating entrepreneurship in Bhutan.

Apr 11, 2019 11:08

Travel

Can Bhutan Take Its Happiness Brand To The Next Level?

Two key challenges: galvanising citizens as brand ambassadors and applying brand recognition to growth sectors.

Apr 21, 2019 10:40

The Magical Waters Of Gasa Tsachu – A Popular Hot Spring In Bhutan

While most people visit the hot spring in the hope that it could cure them of various ailments, it has become an annual visit for many to...

Mar 25, 2019 14:38

Lifestyle

Food Review: Cloud9 Cafe & Bar

Cloud9 has always been known in Thimphu for dishing out handcrafted gourmet burgers.

Mar 09, 2019 09:44

Tshering Zangmo Represents Bhutan At The 5th Young Chef Olympiad In India

Tshering Zangmo has successfully made it to round two of the Olympiad.

Feb 04, 2019 16:35

Subscribe to our newsletter

Never miss out on new happenings and news stories!