Inflation Eases to 1.87% in Mid-September, Driven by Food Price Deflation

Consumer price index-based inflation in Nepal eased to 1.87 percent in mid-September 2025, down from 3.86 percent a year earlier, according to the latest Nepal Rastra Bank (NRB) report.

The Macroeconomic and Financial Situation Report, released Tuesday, October 14, showed contrasting trends between food and non-food categories. The food and beverage group recorded a 1.34 percent deflation, while non-food and services inflation stood at 3.70 percent. In the same month last year, both groups recorded inflation of 5.06 percent and 3.19 percent, respectively.

Within the food and beverage category, the prices of ghee and oil rose 11.09 percent year-on-year, followed by non-alcoholic drinks (3.97 percent) and milk products and eggs (2.66 percent). In contrast, the price indices of vegetables fell 12.74 percent, spices declined 6.31 percent, and pulses and legumes dropped 3.58 percent.

In the non-food and services group, miscellaneous goods and services saw the highest rise at 11.77 percent, followed by education (7.67 percent), clothing and footwear (6.29 percent), tobacco products (4.84 percent), and furnishing and household equipment (4.55 percent) compared to mid-September last year.

Inflation also varied across regions. Prices in urban areas increased 1.91 percent, while rural areas saw a 1.73 percent rise.

Among provinces, Koshi Province recorded the highest inflation at 2.99 percent, followed by Madhesh (1.74 percent), Bagmati (1.72 percent), Lumbini (1.76 percent), Karnali (1.85 percent), Gandaki (1.47 percent), and Sudurpashchim (0.88 percent).

Regionally, inflation stood at 2.51 percent in the mountainous areas, 2.21 percent in the Kathmandu Valley, 1.70 percent in the Terai, and 1.68 percent in the Hills.