Inflation rate down further in August

Inflation fell for the second month in a row. The decrease is predominantly caused by lower food prices. According to Bangladesh Bureau of Statistics (BBS), food inflation, which is more important in developing countries like Bangladesh where a large amount of household incomes are spent on food, slightly declined to 4.3% in August from 4.35 in July. While releasing data at the NEC conference room yesterday, Planning Minister AHM Mustafa Kamal said: “Declining food prices, particularly imported ones, pushed inflation further down.” He hoped that the inflation would be well below the fiscal target for this year. The government fixed the target to contain inflation at 5.8% for the fiscal year 2016-17. However, non-food inflation slightly increased to 7% from 6.98% during the period. In rural areas, the inflation rate in August was 4.41%, which was 4.54% in July, and in urban areas, it rose to 7.15% from 7%. In rural areas, food inflation moved down 3.4% from 3.59%, and in urban areas, it climbed to 6.39% from 6.11% during the period. In the case of non-food inflation, it was up 6.28% from 6.26% in rural areas, while it soared 7.99% from 7.98% in urban areas. The national wage index, however, witnessed a declining trend with 6.06% in August, down from 6.13% in July. The average year-on-year rate of inflation from September 2015 to August 2016 also declined to 5.77%, which was 6.13% from September 2014 to August 2015.