Inflation on the rise

Consumer Price Index shows y-o-y increases in prices except transportation

The Consumer Price Index (CPI) saw a year-on-year increase of 3.1 percent as it stood at 132.4 at end-December 2011, according to the Central Administration of Statistics (CAS).
The CPI had posted a larger y-o-y increase of 4.6 percent for the previous year (December 2009-December 2010).
The CPI measures the price of goods in an economy by tracking the cost of a basket of goods over time. The CPI is often used as a proxy for inflation.


The prices of food and non-alcoholic beverages, which make up for 19.9 percent of the index weight, rose by 5.8 percent y-o-y at the end of December 2011.
The FAO food price index, which measures the prices of five basic food commodities (sugar, meat, oils and fats, cereals, and dairy products), dropped by 5.6 percent y-o-y in December 2011.

Prices of alcoholic beverages and tobacco (2.1 percent of the index weight) grew by 11.4 percent compared to December 2010. The cost of education (7.7 percent of index weight) rose by 7.5 percent, while the cost of healthcare (6.8 percent of index weight) grew by 3.2 percent.
The prices of water, electricity, gas, and other fuels (9.5 percent of index weight) were up by 5.9 percent over the covered period. The global prices of oil increased by 8.3 percent y-o-y, standing at $99 per barrel in December 2011.
The only exception to the rising trend of prices was transportation costs (12.3 percent of index weight) which fell by 2.6 percent y-o-y.

The prices of housing (16.2 percent of index) and communication (4.8 percent of index) were unchanged over the covered period.
The prices of clothing and footwear (6.2 percent of index) grew by 4.3 percent, and those of furnishing and household equipment (3.9 percent of index) increased by 2.2 percent.
The prices of the category of restaurants and hotels (2.7 percent of index) and that of recreation and amusement (3.7 percent of index) rose by 3.9 and 5.3 percent respectively. The prices of miscellaneous goods and services (4.2 percent of index) were up by 2.4 percent.