Mountain Region Inflation Driven by 5.06% Surge in Non-Food and Services

The Mountain region recorded the highest inflation among Nepal’s ecological belts at 2.59% year-on-year in July–August 2025/26, with the index climbing from 103.18 last year to 105.85. On a monthly basis, inflation also edged up by 0.25% compared to June–July 2025, showing steady price pressure in the region.

The Food and Beverage group (39.20% weight) declined by -1.15% year-on-year, with the index falling from 104.96 to 103.75. This signals that households experienced some relief in food spending, especially for seasonal agricultural items such as cereals and vegetables. However, this easing effect was overshadowed by the steep rise in service-related costs.

The Non-food and Services group (60.80% weight) surged by a striking 5.06% year-on-year, increasing from 102.04 to 107.21. This is the sharpest jump among all ecological belts, reflecting the high cost of housing, utilities, education, transportation, and healthcare in the Mountain region. Given the region’s logistical challenges, transport and supply-chain expenses amplify inflationary pressures, making services disproportionately expensive.

In effect, while food inflation provided limited relief, service inflation has become the core driver of the Mountain belt’s cost of living, pushing overall inflation higher than in Kathmandu Valley, Terai, and Hill regions.