RENUKA RAI | Thimphu
The cost of living in Bhutan continued to rise in December 2025, with national inflation reaching 3.37 percent, according to the Consumer Price Index (CPI) released by the National Statistics Bureau on January 30, 2026.
The increase in inflation was mainly driven by higher prices of food items and selected non-food goods and services across the country.
The latest data shows that price pressures remained steady throughout the year, with the average inflation rate from January to December 2025 standing at 3.50 percent.
Compared to November 2025, prices also increased slightly on a month-on-month basis, indicating continued upward movement in consumer prices.
Food prices played a major role in pushing inflation higher at the national level. Food inflation rose to 4.36 percent in December 2025, marking an increase compared to previous months.
Within the food category, prices of food and non-alcoholic beverages increased by 4.35 percent, while prices of alcoholic beverages and betel nuts rose by 4.50 percent.
These increases suggest that households spent more on everyday food items during the month, adding pressure to household budgets.
Non-food inflation also increased, although at a slower pace compared to food. In December 2025, non-food inflation stood at 2.70 percent. Among non-food items, clothing and footwear recorded one of the highest increases at 5.01 percent.
Prices in restaurants and hotels rose by 3.81 percent, while health-related costs increased by 3.95 percent. Transport prices also increased by 2.39 percent, contributing to the overall rise in non-food inflation.
On a month-on-month basis, national inflation increased by 0.38 percent in December 2025. This rise was again largely driven by food prices, which increased by 0.76 percent compared to November.
Food and non-alcoholic beverages rose by 0.77 percent, while alcoholic beverages and betel nuts increased by 0.65 percent.
In contrast, non-food prices declined slightly by 0.05 percent during the month, mainly due to a small drop in transport prices, while most other non-food categories remained unchanged.
Inflation trends varied across regions, with the central region recording the highest year-on-year inflation in December 2025.
The central region’s inflation rate rose to 4.15 percent, driven largely by food prices. Food inflation in the region increased sharply to 6.19 percent, supported by a 6.75 percent rise in food and non-alcoholic beverages and a 2.68 percent increase in alcoholic beverages and betel nuts.
Non-food inflation in the central region stood at 2.00 percent, with clothing and footwear prices rising by 5.62 percent and household furnishings increasing by 2.52 percent.
Month-on-month inflation in the central region increased by 0.41 percent in December 2025. Food prices rose by 0.84 percent during the month, while non-food prices declined slightly by 0.01 percent due to lower transport costs.
In the eastern region, year-on-year inflation increased to 3.12 percent in December 2025. Food inflation in the region stood at 3.43 percent, with food and non-alcoholic beverages increasing by 3.39 percent and alcoholic beverages and betel nuts rising by 4.02 percent.
On a month-on-month basis, inflation in the eastern region increased by 0.36 percent in December 2025.
The western region also experienced an increase in inflation, with year-on-year inflation rising to 3.64 percent in December 2025.
Food inflation in the region increased to 3.94 percent, supported by a 3.80 percent rise in food and non-alcoholic beverages and a sharper 5.73 percent increase in alcoholic beverages and betel nuts.
The capital city recorded a lower inflation rate compared to other regions. Year-on-year inflation in the capital city increased to 2.75 percent in December 2025.
Food prices rose by 3.70 percent, while non-food prices increased by 1.89 percent. Within the food category, food and non-alcoholic beverages increased by 3.75 percent, and alcoholic beverages and betel nuts rose by 2.91 percent.
The CPI report also highlights the continued decline in the purchasing power of the Ngultrum. As of December 2025, the purchasing power of the Ngultrum stood at Nu. 53.5 when compared to December 2012 prices.
This means that Nu. 100 in December 2025 had the same purchasing value as Nu. 53.5 in 2012.
Over the last year alone, from December 2024 to December 2025, the purchasing power of the Ngultrum declined by 3.26 percent due to rising prices.
Overall, the CPI data for December 2025 shows that inflation remained moderate but persistent throughout the year, with food prices continuing to be the main driver of rising living costs.
Regional differences in inflation highlight varying price pressures across the country, while the decline in the purchasing power of the Ngultrum reflects the impact of sustained price increases on households.
The CPI figures provide an important snapshot of price movements and living costs, offering policymakers, businesses, and households a clearer picture of inflation trends as Bhutan enters 2026.
