According to the Central Administration of Statistics (CAS), the Consumer Price Index (CPI), representing the evolution of goods and services’ prices consumed by households, revealed that Lebanon’s monthly inflation rate jumped from 100.64% in June 2021 to register elevated levels of 210.08% in June 2022.
In details, the cost of “Housing and utilities”, inclusive of water, electricity, gas and other fuels (grasping 28.5% of the CPI) added a yearly 132.28% by June 2022. Also, “Owner-occupied” rental costs increased by 6.21% year-on-year (YOY) and the average prices of “water, electricity, gas, and other fuels” followed a significant increase by 594.46% YOY as subsidies were removed by the Central Bank and prices went up sharply on the global market due to the war in Ukraine.
Looking at the prices of “Food and non-alcoholic beverages” (20.6% of CPI), it surged by 332.35% yearly. In turn, the average prices of “Transportation” (13.1% of the CPI) and “Health” (7.8% of the CPI) recorded hikes of an annual 462.40% and 492.20% respectively by June 2022. Also, “Restaurant and Hotels” (2.6% of CPI) increased yearly by 271.85% by June 2022 and expected to surge further in the upcoming months as the hospitality sector is authorized to adopt prices listed in dollars.
In the same token, costs of “Clothing and Footwear” (5.4% of CPI) surged by 167.94% by June 2022, and the prices of “Communication” (4.6% of the CPI) increased by 7.28%.
Finally, prices of “Furnishings and household equipment” (3.7% of CPI), “Alcoholic beverages and tobacco” (1.6% of CPI), and “Recreation, amusement, and culture” (2.3% of the CPI) increased by 159.50%, 221.58%, and 124.40%, respectively, by June 2022.
Lebanon is facing historical high inflation levels driven by high volatility in prices. The local market is following worldwide trend of overheated inflation driven by elevated energy prices and supply disruptions. Not to mention that the devaluation of the Lebanese pound is a major drive in maintaining the skyrocketing inflation. These factors are unlikely to fade anytime soon, and inflationary pressures would likely to peak further as global and local political and economic outlook remain uncertain.
Inflation rate by June 2022
Source: CAS, BLOMINVEST