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Bangladesh's overall inflation eases, but non-food still pinches millions
Last Updated(Beijing Time):2012-08-05 19:31

Bangladesh's July inflation eased slightly to 8.03 percent from 8.56 percent in the previous month, but non-food items remained a big headache for the country's millions of less affluent families, said statistics agency officials Sunday.

Abul Kalam Azad, a senior official of Bangladesh Bureau of Statistics (BBS), told Xinhua that overall inflation rate, which dipped to 9.93 percent in April after staying in double digit figures for many months, maintained its sliding motion in the last two months as food items marked sharp fall.

Bangladesh's food inflation fell to 6.30 percent in July, compared to 7.08 percent in June, he said, adding the country's food inflation stood at 13.40 percent in July last year.

The country's point-to-point inflation reached 10.96 percent in July last year while in the same month the non-food figure was 6. 46 percent.

"Inflation in non-food items eased slightly to clock a 11.54 percent rise in July this year from 12.72 percent in June," Azad said.

Another BBS official said prices of non-food commodities such as garments, medical services, transport, furniture and those of household and laundry increased to some extent, causing the spike in inflation in non-food sector.

The rise in non-food inflation has been driven by rise in prices of mainly electricity and fuel oils, as the authorities had raised their tariffs many times since Prime Minister Sheikh Hasina's government came to power in January 2009, vowing to reduce subsidy burden on the economy, said an official who preferred to be unnamed.

But he said that fall in food inflation has come as a big relief for the government which is struggling to contain inflation.

The official said the price hike in food items, particularly staple rice, is a key concern for the government as about 31.5 percent of people live on less than 2 U.S. dollars a day and spend a large part of their earnings on food.

Bangladesh's overall rate of inflation came down to single digit as food inflation rate maintained the sliding trend against the backdrop of bumper domestic crop which contributed a lot to cooling down food prices, he added.

Officials said the Bangladesh Bank (BB) has been maintaining a restrained monetary policy to rein in inflation particularly in non-food sector which has become a reason of headache for the government's relevant agencies.

The central bank of Bangladesh in the middle of the last month rolled out its monetary policy for the first half of the current fiscal year 2012-13 (July 2012-June 2013), putting special focus on "inclusive growth" with maintaining inflation at moderate levels.

Unveiling the half yearly monetary policy, spanning from July to December 2012, BB Governor Atiur Rahman said inflation remained in double digits in the last fiscal year. "So curbing inflation will be the major challenge," he said.

According to latest data released by the BBS last month, the average inflation rate in Bangladesh during the 12 months of the 2011-12 fiscal surged to a level of 10.62 percent.

The food inflation eased to 10.47 percent in the 2011-12 fiscal year (July 2011-June 2012) from 11.34 percent in 2010-11 fiscal year. Non- food inflation, however, surged to 11.15 percent compared to the previous year's 4.15 percent, it showed.

The average inflation rate in the South Asian nation of over 152.52 million people during the 12 months of the last 2010-11 fiscal year (July 2010-June 2011) reached 8.80 percent.

Source:Xinhua 
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