Bhutan’s consumer inflation fell to 6.6 percent in November last year, the lowest recorded so far in 2014. The decrease in the rate of inflation was driven mainly by a reduction in the price of fossil fuel.
Fuel prices dropped by 4.93 percent in July to 0.32 percent in November. Global fuel prices have decreased since June last year in the face of increased production and lesser demand.
In October, inflation was recorded at 7 percent.
Between October and November, prices of goods and services recorded only 0.07 percent increase.
Officials from National Statistics Bureau said this was a case of disinflation, which meant, although prices were increasing, it did at a very slow rate.
When it came to imported commodities, prices deflated to negative 0.01 percent in October and remained at zero in November last year.
Bhutan buys most of its product from India and the decrease in the price of fuel helped reduce inflation in Bhutan as well.
However, prices of domestically produced commodities remained more or less the same during the same period.
Purchasing power of Ngultrum dropped by Nu 16 from December 2012 to November 2014. In other words, if you buy Nu.100 worth commodity today, the same commodity would have cost only Nu. 84 in November, 2012.
In 2012, Bhutan recorded the highest inflation rate at 10.9 percent, which was a spiraling impact of the shortage of Indian rupee and exchange rate fluctuation between the rupee and the dollar.
