Logo of Phnom Penh Post newspaper Phnom Penh Post - Inflation fueled by rising global oil prices

Inflation fueled by rising global oil prices

Inflation fueled by rising global oil prices

110426_7b
A man pumps petrol into a car at a Petronas station on Mao Tse Toung Boulevard in Phnom Penh yesterday.

Prices in the first quarter increased an average of 3.6 percent on the same quarter last year, driven largely by increases in international fuel prices, according to experts.

Price inflation in Cambodia bottomed out in late 2010, and has gradually been increasing since, according to Olaf Unterroberdoerster, a senior economist at the International Monetary Fund.

“However, at 3.6 percent on average in the first quarter of 2011, inflation has been moderate compared to Cambodia’s neighbours,” he wrote.

Vietnam’s consumer prices climbed 17.51 percent in April from a year earlier, according to figures released Sunday by the Hanoi-based General Statistics Office – the highest increase since December 2008.

The IMF forecasts Cambodia’s inflation to increase to an average of 5 percent in 2011 – from an average 4 percent in 2010 – mainly on the back of rising fuel prices, according to Olaf Unterroberdoerster.

“With inflation pressures on the rise it will be important that policy makers remain vigilant and maintain a prudent monetary and fiscal policy stance.”

Brent crude traded yesterday above US$124.30 on international markets, from below $87 one year ago.

NIS Deputy Director General Khin Song said fuel prices were a main reason behind the overall increase, though most prices remained relatively stable. The NIS-compiled Consumer Price Index  shows fuel prices were a large factor in the price rise, increasing 3.08 percent on average in the first quarter compared year on year, while prices for food and non-alcoholic beverages increased 3.87 percent in the same period.

Other large gains were the price of transport – up an annualised 5.04 percent on the first quarter – and restaurants and hotels costs up 5.66 percent.

“This quarter, the speed of inflation increased a bit, but it is not noticeable – we are on track to keep inflation under 5 percent,” said Khin Song.

Business Research Institute for Cambodia Chief Economist Suzuki Hiroshi wrote that the Consumer Price Index has been stable, though he added domestic prices would likely continue increasing in the coming months.

“I notice that prices increase a little bit [in the second quarter] – that’s seasonal,” he said. “However, I don’t think it will be higher than five percent.”

ADDITIONAL REPORTING BLOOMBERG

MOST VIEWED

  • Phnom Penh placed in two-week lockdown

    The government has decided to place Phnom Penh in lockdown for two weeks, effective April 14 midnight through April 28, as Cambodia continues to grapple with the ongoing community outbreak of Covid-19, which has seen no sign of subsiding. According to a directive signed by Prime Minister

  • Cambodia on the verge of national tragedy, WHO warns

    The World Health Organisation (WHO) in Cambodia warned that the country had reached another critical point amid a sudden, huge surge in community transmission cases and deaths. “We stand on the brink of a national tragedy because of Covid-19. Despite our best efforts, we are

  • Hun Sen: Stay where you are, or else

    Prime Minister Hun Sen warned that the two-week lockdown of Phnom Penh and adjacent Kandal provincial town Takmao could be extended if people are not cooperative by staying home. “Now let me make this clear: stay in your home, village, and district and remain where

  • Businesses in capital told to get travel permit amid lockdown through One Window Service

    The Phnom Penh Municipal Administration has issued guidelines on how to get travel permission for priority groups during the lockdown of Phnom Penh, directing private institutions to apply through the municipality's One Window Service and limit their staff to a mere two per cent. In

  • Vaccination open to foreigners in Cambodia

    The Ministry of Health on April 8 issued an announcement on Covid-19 vaccination for foreigners residing and working in Cambodia, directing the Ministry of Labour and Vocational Training and local authorities to register them. Health minister Mam Bun Heng, who is also head of the inter-ministerial

  • Ministry names types of business permitted amid lockdown

    The Ministry of Labour and Vocational Training singled out 11 types of business that are permitted to operate during the lockdown of Phnom Penh and Takmao town, which run through April 28. Those include (1) food-processing enterprises and slaughterhouses; (2) providers of public services such as firefighting, utility and