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Market Watch 21

High food prices remain a significant concern. The most recent year-on-year food price inflation figure provided by the Nepal Rastra Bank in January was 17.8 percent --up by almost 2 percent compared to last month. High food prices are driving overall high consumer price inflation, which is currently estimated at 11.3 percent.

Over the past month the price of staple grains have remained relatively stable due to the summer crop harvest. However, as the harvest was weak it did not have a major impact on reducing the price of key commodities in most markets (as would normally be expected).

A recent bird flue outbreak in the Pokhara region could have a major impact on poultry trade and prices during the first half of 2010. Previous outbreaks have seriously impaired poultry markets in Nepal.

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