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Inflation rate jumps to 9.52 percent in June
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Lao consumers continue to struggle with higher living costs as inflation reached 9.52 percent in June. | The Consumer Price Index (CPI) remains high, despite the government increasing efforts to tackle the rising price of goods in Laos.
The Ministry of Planning and Investment's National Statistic Bureau announced on its website that the CPI reached 106.80 points in June, putting the June inflation rate at 9.52 percent compared to the same period last year.
The bureau is yet to provide a detailed breakdown of the 12 categories of goods that make up the CPI. However, it indicated that the June inflation rate remains higher than the nation's GDP growth in 2010. The government has vowed to keep inflation lower than economic growth this year.
National Economic Research Institution Acting Director General Dr Leeber Leebuapao said yesterday that the driving forces of inflation in Laos in June were continuing increases in the prices of food, communications and transportation.
“We are studying the price structure of the food, communication and transport categories,” he said, adding that the research aims to provide policy makers clearer references on which to make decisions targeted at lowering the inflation rate.
He said that the price of fuel in Laos and around the world has remained stable over the past few months but prices for communication, transport services and food continue to increase, moving Lao economists to study the price structure of goods and services in these categories.
He said that economists suspect that some of the increases in prices for a number of food goods are the result of profiteering by some business people, adding that he expects the study to provide a clearer picture of the situation next month.
Dr Leeber also said that recent natural disasters in Laos would add pressure to the government's efforts to curb rising inflation in the country, adding that several hundred food production bases have been damaged by the floods. He said a number of the roads linking cities and rural areas have been damaged, disrupting the supply of goods and leading to a spike in prices in some regions.
Officials from the Ministry of Industry and Commerce and the Bank of the Lao PDR have been unable to reach a consensus on the main cause of growing inflation in the country. Some officials suspected that a rise in the supply of money is the cause, but the central bank has declared that money supply is not the reason behind rising inflation. Central bank officials have urged the relevant sectors to boost production of goods to ensure sufficient supply and reduce prices.
Laos has experienced a period of high inflation this year, with the inflation rate rising from 6 percent in January to 9.24 percent in Apri l and 9.76 percent in May. The increasing inflation rate is posing challenges to future economic stability as businesses face higher production costs and consumers are unable to afford to buy more expensive goods and services.
vientiane times
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