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Cambodia's consumer prices decline

Cambodia's consumer prices decline

120625_07

Women buy meat at an open-air market in Phnom Penh earlier this month. After a steep price increase earlier this year, the cost of meat decreased last month. Photograph: Will Baxter/Phnom Penh Post

Consumer prices decreased month-on-month in May for the first time since statistics were available, Cambodia's National Institute of Statistics (NIS) data showed.

The 1.1 per cent drop, driven largely by lower food and gasoline prices, would be a relief to businesses and shoppers after a period of sustained inflation – as high as 18 per cent in February and March for commodities such as pork.

The downward trend runs parallel to inflation in some neighbouring countries.

Vietnam, although cooling from consumer price jumps as high as 20 per cent last year, saw 4.6 per cent inflation in May.

Year-on-year inflation, however, continued to rise in Cambodia last month.

The price of gasoline went down by 4.9 per cent on the month, food decreased by 0.8 per cent and rice decreased by 1.5 per cent, according to the data.

Fresh fish and seafood declined 3.3 per cent, pork was down 1.7 per cent, fruit fell 1.7 per cent and cooking gas and oil dropped 1.2 per cent.

“It was pretty low in May because … we were getting a better supply of goods to meet the market demand, causing some products to decline in price while some others were stable,” Khin Song, deputy director of the NIS said. “We also noticed the price of gasoline has been declining recently, which is the main factor contributing to the decline. At the same time, we also have a stable exchange rate, so we have no concerns.”

Compared to the same time last year, inflation has increased 2.2 per cent.

Food and non-alcoholic beverages rose by 2.1 per cent, rice rose by 4.5 per cent and beef rose by 14.2 per cent, statistics showed.

Gasoline saw a 4.8 per cent increase.

“The price of beef is still high due to our production not responding to the market. The government is trying to encourage our people to continue to raise more animals to supply the market,” Khin Song added. “But our inflation rate, which is below the [annual] five per cent level, is pretty good. If we compare from May to April, our prices declined for all kinds of products.”

Khin Song predicted [annual] inflation in June would be similar in May, at around two to three per cent.

Month-on-month inflation for February and March averaged at 5.4 per cent, the Post reported, with pork and beef prices hitting more than 14 per cent and eight per cent respectively.

Last year’s floods – the worst in a decade – affected the country's food supply and drove prices upward, experts said.

Officials at the Ministry of Economy and Finance last month said inflation in 2012 would average about five per cent.

To contact the reporter on this story: May Kunmakara at [email protected]

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