Country Report Tonga
- ID: 2138734
- October 2015
- Region: Tonga
- 17 Pages
- The Economist Intelligence Unit
On October 8th the National Reserve Bank of Tonga (the central bank) published data showing that consumer prices were down by 1% year on year in August.
The latest consumer price index (CPI) release underlines the extent to which movements in Tonga's headline figures are dependent on global factors. The CPI has been dragged down by a 6% year-on-year fall in imported prices, reflecting declines in global prices among food products as well as still-low global crude oil prices. The latter led to a 9.1% drop in transport prices and a 15.8% fall in domestic power and fuel prices.
Once the costs of energy (both domestic and imported) and imported food are stripped out, the underlying index shows a 7.9% year-on-year increase in consumer prices. The El Niño weather phenomenon in the western Pacific Ocean has had an increasing impact on local agricultural production since mid-2015, contributing in part to the 6.6% increase in overall domestic prices, with locally produced fruit, vegetables, meat, fish and poultry all showing price increases. Domestic fruit and vegetable prices saw the largest rise in inflation, at 65.9% in August.