Economic Research | Lebanon This Week | Lebanon This Week 642 | Consumer Price Index up 90% in June 2020 | Lebanon | Byblos Bank

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Byblos Bank

Lebanon This Week 642

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Consumer Price Index up 90% in June 2020

The Central Administration of Statistics' Consumer Price Index increased by 38.8% in the first half of 2020, compared to a growth of 3.3% in the same period of 2019. Also, the CPI expanded by 89.7% in June 2020 from the same month of 2019, and registered a double-digit increase in each month so far this year. The cumulative surge in inflation in the first half of 2020 is due in part to the ongoing deterioration of the Lebanese pound's exchange rate on the parallel market, which has encouraged opportunistic wholesalers and retailers to raise consumer prices disproportionately. It also reflects the authorities' inability to monitor and contain prices. 

The prices of furnishings & household equipment surged by 5.1 times annually in June 2020, followed by the prices of clothing & footwear (+4.45 times), prices at restaurants & hotels (+4.42 times), alcoholic beverages & tobacco (+3.54 times), food & non-alcoholic beverages (+3.47 times), miscellaneous goods & services (+2.9 times), recreation & entertainment (+2.3 times), transportation (+84.7%), communication (+83.4%), healthcare costs (+10.5%), actual rents (+8.3%), imputed rents (+5.5%), education (+4.4%), and the prices of water, electricity, gas & other fuels (+0.3%). Also, the distribution of actual rents shows that old rents grew by 11.1% and new rents increased by 6.4% year-on-year in June 2020.

In parallel, the CPI increased by 20.2% in June 2020 from the previous month, compared to a month-on-month growth of 6.9% in May 2020. The prices of furnishings & household equipment increased by 110.5% month-on-month in June 2020, followed by the cost of clothing & footwear (+57.4%), miscellaneous goods & services (+50.2%), recreation & entertainment (+47%), transportation (+41%), prices at restaurants & hotels (+30%), food & non-alcoholic beverages (+17.4%), alcoholic beverages & tobacco (+17%), the cost of water, electricity, gas & other fuels (+12.6%), healthcare costs (+4.4%), communication (+2.3%), actual rents (0.5%), education and imputed rents (+0.4% each).

Further, the CPI increased by 23.4% in the Bekaa, by 22% in the South, by 21.3% in Nabatieh, by 20.4% in the North, by 20.2% in Mount Lebanon, and by 15.4% in Beirut in June 2020. In parallel, the Fuel Price Index grew by 11% month-on-month in June 2020, while the Education Price Index expanded marginally by 0.4% in the covered month.
 
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