Inflation cuts deeper as food and fuel costs strain households

Saru Katuwal, a 28-year-old master's student in Kathmandu, finds herself working two restaurant jobs to cover rising expenses and support her parents. "Despite all the hustle, it is becoming increasingly difficult to manage my expenses," she said, worried about missing classes due to doubled transportation costs and an impending rent increase.

Parshuram Acharya, an office helper in his early 60s, faces similar struggles. "Vegetable prices go up almost every day. Edible oil, rice, lentils, onions, potatoes, everything is getting more expensive, making it difficult to manage even two meals a day for the whole month," he stated. Even with his son's income, affording a decent living is a challenge.

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Despite all the hustle, it is becoming increasingly difficult to manage my expenses.

Nepal Rastra Bank reported consumer inflation hit 5.04 percent in mid-May, a significant increase from the previous fiscal year. Food and beverage inflation rose to 4.63 percent, with notable price hikes in fruits (18.60 percent), ghee and oil (13.99 percent), vegetables (5.40 percent), and meat and fish (4.16 percent). Fuel prices have also surged, with petrol up 38.21 percent and diesel by 58 percent.

Global factors are compounding these domestic pressures. The ongoing impact of the US-Israeli war with Iran continues to affect global trade. Additionally, the World Meteorological Organization warns of a potentially severe El Niño event this summer. Combined with fertilizer shortages and rising oil prices, these shocks threaten to destabilize the fragile food industry and directly impact consumers' shopping baskets.

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Vegetable prices go up almost every day. Edible oil, rice, lentils, onions, potatoes, everything is getting more expensive, making it difficult to manage even two meals a day for the whole month.