Cablegate: Prices Rise in August by 15.1 Percent

VZCZCXRO0603
RR RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #3601 2691301
ZNR UUUUU ZZH
R 261301Z SEP 06
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC 7111
INFO RUCNRAQ/IRAQ COLLECTIVE

UNCLAS BAGHDAD 003601

SIPDIS

SENSITIVE
SIPDIS

NEA/I PLEASE PASS TO TREASURY DEP'T

E.O. 12958: N/A
TAGS: ECIN ECON EFIN IZ
SUBJECT: PRICES RISE IN AUGUST BY 15.1 PERCENT

REF: BAGHDAD 3460

1. (SBU) Iraq's consumer price index (CPI) increased 15.1% in
August, and the year-on-year increase reached 76.6%. The
increase is largely driven by rising prices in the categories
of Fuel/electricity (57.8%) and Transport/communication
(20.8%). GOI's Central Office of Statistics and Information
Technology (COSIT) lists disaggregated percentage increases
(month-on-month) as follows:

Food 6.1%
Tobacco/liquor 0.1%
Clothing/shoes 1.5%
Furniture 0.8%
Fuel/electricity 57.8%
Transport/communications 20.8%
Medical services/medicine 7.0%
Misc. goods/services 3.3%
Rent 0.7%

Compared to the data from August 2005, prices grew at the
following rates:

Food 39.7%
Tobacco/liquor 12.8%
Clothing/shoes 26.7%
Furniture 14.2%
Fuel/electricity 321.8%
Transport/communications 235.8%
Medical services/medicine 22.6%
Misc. goods/services 37.5%
Rent 34.7%

2. (SBU) COSIT describes its CPI data as an imperfect measure
of inflation. Given data collection limitations and an
outdated basket of goods, real inflation is likely higher
than the COSIT estimates (reftel).
KHALILZAD

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