Iraq inflation rate picks up again in October

November 23, 2006 - 0:0
BAGHDAD (Reuters) -- Iraq's inflation rate jumped last month after a big spike in energy prices, a reminder of the economic hardship facing ordinary Iraqis alongside daily bloodshed.

Consumer prices rose 7.2 percent in October after falling 12.8 percent in September, according to Iraq central bank data, and are 52.8 percent higher than a year ago.

Energy prices jumped 32 percent in the month, partly reversing an even sharper decline in September.

The numbers are not seasonally adjusted and are calculated on the basis of a relatively small national survey.

Officials blame the poor security situation for playing havoc with supplies, particularly of gasoline which is the subject of a hugely lucrative black market.

Prices gathered by Reuters reporters from around the country show big regional differences.

The cost of a unit of electricity in Baghdad, where sectarian violence has turned many neighborhoods into no-go areas and residents buy their power from a local generator, is roughly 10,000 dinars ($6.80).

That is twice the price in the somewhat less-troubled religious city of Najaf in the Shi'ite-dominated south.

Food prices rose a more modest 1.2 percent last month. Food is the largest component of the index by far, accounting for over 60 percent compared with 2.1 percent for energy and 4.9 percent for transport and communication.

Official data was borne out by Reuters' informal survey of market prices. These show that the cost of a kilo of tomatoes, an important staple in the Iraqi diet, averaged 965 dinars in various neighborhoods in the capital in October versus 850 dinars in August.