Inflation climbs on food price hike

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After a steady decline for three consecutive months, inflation rate rose by 1.34 percentage points in February because of continuous hike of food prices.

According to Bangladesh Bureau of Statistics (BBS), the inflation rate was 7.28 percent in February and 5.94 percent in January. The highest inflation rate in recent times was 7.31 percent in last October.

The BBS data also show inflation rate of food items increased by 1.71 percentage points in February while the rate of non-food items rose 0.80 points during the same time.

Food price index soared to 8.36 percent in February, which was 6.65 percent in January. Inflation rate of non-food items was 5.74 percent in February and 4.95 percent in January, according to available data.

A Bangladesh Bank official said demand and supply of essential commodities faced a setback in February due to the joint forces’ indiscriminate drives against hoarding, resulting in continuous hike of food prices.

“Such unsystematic drives caused shortage of commodities resulting in commodity price hike,” the official said.

A finance ministry official said the law enforcers have been asked to take assistance from the National Board of Revenue, Anti-Corruption Commission and Bangladesh Bank before going for such drives.

The government also introduced fair price shops, which helped reduce essentials prices, except edible oil, slightly in recent times, he said.

According to a Trading Corporation of Bangladesh (TCB) report prepared last month, the prices of essentials have also seen a constant rise in recent years.

The TCB report showed that prices of all types of rice went up by 2 to 13 percent in February while price of coarse rice, mostly consumed by poor people, rose by 18 percent.

In last one year, wheat prices went up by about 31 percent while soybean oil prices increased by 41.49 percent.

According to the TCB data, onion prices shot up by 12.82 percent in the last one month while the rate was 91.30 percent in the last one year.

Banking sector sources said at present there is no scarcity in production of commodities in the country and import is also adequate.

However, the central bank officials predict further rise in the inflation rate in April due to the recent hike of petroleum prices between 16 and 21 percent.

Sources said the hike would cause more inflation hike if the government fails to check irrational climb of transport costs.

“The government will have to work hard for smooth agricultural production to halt further rise of inflation rates,” a source viewed.

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