Consumer price inflation in Nepal moderated to 2.72 percent in mid-June 2025, down from 4.17 percent recorded during the same period last year, according to the latest report of Nepal Rastra Bank (NRB).

The Current Macroeconomic and Financial Situation Report, released by the central bank on Tuesday, shows that inflation in the food and beverage group rose by just 0.54 percent, while prices in the non-food and services category climbed by 3.94 percent during the review month. In contrast, these categories had seen inflation rates of 5.85 percent and 3.07 percent, respectively, a year earlier.

According to the report, the food and beverage inflation, in particular, dropped sharply from over 10 percent in December 2024 to below 1 percent by June 2025, significantly pulling down the overall inflation rate.

Within the food and beverage group, prices of ghee and oil surged 10.06 percent annually, followed by non-alcoholic drinks (5.13 percent), fruits (3.51 percent), and pulses and legumes (2.85 percent). However, vegetable prices dropped 7.04 percent, spices fell 3.06 percent, and meat and fish declined by 2.91 percent.

On the non-food and services category, the cost of miscellaneous goods and services increased by 9.43 percent, clothing and footwear by 6.82 percent, education by 5.88 percent, household furnishings and equipment by 5.06 percent, and tobacco products by 4.68 percent compared to mid-June last year.

Inflation also varied across geographic areas. Prices in rural areas rose by 2.90 percent, slightly higher than the 2.66 percent increase seen in urban areas, the report added.

Among provinces, Koshi recorded the highest inflation at 4.18 percent, followed by Sudurpashchim at 3.86 percent followed by Karnali Province (2.54 percent), Madhesh Province (2.52 percent), Lumbini Province (2.39 percent), Bagamati Province (2.29 percent), and Gandaki Province (1.75 percent).

Regionally, inflation stood at 4.18 percent in the mountain region, 2.73 percent in Kathmandu Valley, 2.58 percent in the Terai, and 2.48 percent in the hill areas.

According to the NRB, the report is based on data covering the first eleven months of the current fiscal year.