The NEPSE Journal
Market commentary, data deep-dives, and trading notes from the NEPSE Trading desk.
Nepal’s inflation has slowed sharply from 7.74% in 2022/23 to just 1.68% in August 2025/26, the lowest in four years. While food prices have eased significantly, service-driven costs in housing, health, and education remain a persistent challenge for households.
Nepal’s CPI growth in August 2025/26 slowed to just 1.68%, the lowest in four years. While food prices eased, making groceries more affordable, non-food and service costs remain high, showing that inflation is now structurally service-driven.
Nepal’s inflation slowed from 7.74% in 2022/23 to 5.44% in 2023/24, and further to 4.06% in 2024/25. The sharp drop reflects easing food prices and tighter monetary policy, but rising service costs show that inflation is shifting from being food-driven to service-driven.
Nepal’s CPI rose 1.68% in July–August 2025/26, the slowest pace in years, compared to 4.09% in 2024/25 and 7.52% in 2023/24. While consumers are benefiting from falling food prices, non-food and services remain costly, making inflation increasingly service-driven rather than food-driven.
Nepal’s national CPI rose 1.68% year-on-year in July–August 2025/26. Food prices fell nationwide, but non-food and services jumped sharply, with Kathmandu Valley (2.26%) and Mountain belt (2.59%) leading the inflation trend.
Nepal’s CPI rose 1.68% year-on-year in July–August 2025/26. All regions saw food prices decline, but non-food and services jumped sharply (up to 5.06% in the Mountain belt). This shift makes services the new engine of inflation, raising the cost of living nationwide.
The Mountain region saw 2.59% annual inflation in July–August 2025/26. Food costs fell -1.15%, but non-food and services soared 5.06%, making it the most inflation-affected region in Nepal.
Terai inflation stood at 1.33% while Hill inflation was slightly higher at 1.56% in July–August 2025/26. However, non-food costs surged more in the Terai (4.17%) than in the Hill (3.31%), showing that service inflation is a bigger burden in the Terai despite stronger food price relief.
Kathmandu Valley inflation hit 2.26% in July–August 2025/26. Food costs fell -2.10%, but services rose 3.95%, making non-food expenses the main inflation driver in the capital.
Nepal recorded 1.68% annual inflation in July–August 2025/26. Food prices fell across all regions, easing household grocery costs, but non-food and services rose up to 5.06%, making Kathmandu Valley and Mountain the most inflation-pressured regions. Services have become the new engine of inflation, outweighing food price relief.