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 inflation rate eased from a 239.68% in January 2022 to register softer levels of 123.53% in January 2023, however higher than the previous month of December 2022 at 121.99%. Unfortunately, inflation remains at a historical elevated level and is expected to further increase in the months ahead as most organizations are discussing a full dollarization plan. That is in addition to the fact that prices went up as customs and taxes are being collected at the official rate of 15,000 LBP/USD instead of 1507.5 LBP/USD.
In details, the cost of “Housing and utilities”, inclusive of water, electricity, gas and other fuels (grasping 28.4% of the CPI) added a yearly 56.28% by January 2023. Also, “Owner-occupied” rental costs increased by 9.18% year-on-year (YOY) and the prices of “water, electricity, gas, and other fuels” followed a significant increase by 162.82% YOY due to global inflation following the war in Ukraine.
Looking at the prices of “Food and non-alcoholic beverages” (20% of CPI), it surged by 138.47% yearly. In turn, the average prices of “Transportation” (13.1% of the CPI) and “Health” (7.7% of the CPI) recorded hikes of an annual 135.21% and 175.95% respectively by January 2023. Also, “Restaurant and Hotels” (2.8% of CPI) increased yearly by 173.66% by January 2023 as the hospitality sector had been authorized to adopt prices listed in dollars.
In the same token, costs of “Clothing and Footwear” (5.2% of CPI) surged by 160.58% by January 2023, and the prices of “Communication” (4.5% of the CPI) increased by 331.07% as mobile phone bills are currently charged in dollars and paid on Sayrafa rate.
Finally, 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 110.39%, 109.23%, and 143.14%, respectively, by January 2023.
Inflation rate by January 2023
Source: CAS, BLOMINVEST