DHAKA, Jan 8 (Reuters) - Bangladesh's annual inflation rate
in December accelerated for the second month in a row and price
pressures could intensify further after authorities raised fuel
prices last week.
Fuel prices were increased by up to 11.5 percent from
Thursday midnight in the latest move to trim the government's
subsidy burden, sparking widespread criticism and a nationwide
strike enforced by the main opposition alliance on Sunday.
Annual inflation in December was 7.69 percent, based on the
old series using 1995-96 as a base year, the statistics office
said on Tuesday, compared with 7.41 percent in November, which
snapped a declining trend since February 2012.
Food prices in December were 7.33 percent higher than a year
earlier, an increase from November's on-year pace of 6.45
percent. In contrast, the non-food inflation pace fell to 8.43
in December from 9.31 percent the previous month.
A spike in prices of rice, pulses, fish, meat and spices
pushed food inflation higher, a senior official at the Bureau of
However, prices of both food and non-food items would likely
go up sharply due to the fuel price hike, the official said.
December's reading, based on the new series using 2005-06 as
a base year, was 7.14 percent, up from November's 6.55 percent.
In another unpopular move the government plans to raise
electricity tariffs, which could add to public fury over the
spiralling cost of living.
Prices pressures are a major concern for the government,
which faces an election in late 2013.
The central bank has kept its key policy rate unchanged
since last January, when it was raised for the fifth time since
Annual inflation in the financial year that ended in June
2012 accelerated to 10.62 percent from 8.80 percent the previous
year. Non-food prices were the major contributor as the
government, saddled with a huge subsidy bill for oil, raised
fuel and power charges several times.
Bangladesh aims to trim inflation to 7.5 percent in the
current fiscal year.
(Reporting by Ruma Paul; Editing by Anis Ahmed, Ron Askew)