According to the Central Administration of Statistics (CAS), the Consumer Price Index (CPI), which gives an overview about the evolution of goods and services’ prices consumed by households, revealed that Lebanon’s monthly inflation rate soared from 136.8% in October 2020 to reach a dramatic level of 173.57% in October 2021.
In more details, the average inflation rate by October 2021 reached 137.04%, higher than the average inflation rate of 73.20% over the same period in 2020. Accordingly, all sub-components of Lebanon’s consumer price index (CPI) increased over the studied period.
In turn, the cost of “Housing and utilities”, inclusive of water, electricity, gas and other fuels (grasping 28.4% of the CPI) added a yearly 75.72% by October 2021, where “Owner-occupied” rental costs increased by 2.59% year-on-year (YOY) while the average prices of “water, electricity, gas, and other fuels” soared by 271% YOY.
Looking at the prices of “Food and non-alcoholic beverages” (20% of CPI), it surged by 303.66% yearly. In turn, the average prices of “Transportation” (13.1% of the CPI), “Health” (7.7% of the CPI) and “Restaurant and Hotels” (2.8% of CPI) all recorded hikes of an annual 508.23%, 232.80% and 301.97%, respectively, by October 2021.
In the same token, costs of “Clothing and Footwear” (5.2% of CPI) surged by 209.08% by October 2021, and the prices of “Communication” (4.5% of the CPI) increased by 34.54%.
Worth mentioning, prices of “Furnishings and household equipment” (3.8% of CPI), “Alcoholic beverages and tobacco” (1.4% of CPI), and “Recreation, amusement, and culture” (2.4% of the CPI) increased by 150.02%, 220.98%, and 126.80%, respectively, by October 2021.
Inflation is not just a Lebanon problem today, though Lebanon’s is perhaps the most severe. Worldwide consumers are witnessing skyrocket prices for goods and services. However, reasons for this inflation vary by country, and what has been seen in Lebanon is a direct result of removal subsidies on essential goods and huge depreciations in the exchange rate. Unsurprisingly, further increase in inflation will occur as no ration card has been put on the table, while Lebanese pound is still on the decline.
Inflation rate by October 2021
Source: BlomInvest, Central Administration of Statistics (CAS)