Laos’ inflation rate reached 7.7 percent in August, a slight increase from 7.6 percent in July, while average inflation for the first eight months of the year stood at 7.9 percent.
Housing, water supply, electricity and cooking fuel recorded the largest increase, rising 30.2 percent from the same period last year.
Prices for other goods and services increased 18.1 percent, while healthcare costs, including pharmaceuticals and hospital services, rose 12.4 percent. Education costs increased 12 percent, including school fees, uniforms and school supplies.
Transportation and communication prices rose 11.4 percent, followed by alcohol and tobacco at 9.5 percent. Hotel and restaurant services increased 8.8 percent, while clothing and footwear prices rose 7.4 percent.
Inflation Remains Above Government Target
Laos’ inflation rate rose slightly to 7.6 percent in July from 7.4 percent in June, after falling from 10.2 percent in April to 9 percent in May. The decline was partly driven by easing fuel prices and more stable exchange rate conditions.
The July increase was largely driven by electricity prices, which jumped 91.5 percent year-on-year.
The government has continued to prioritize price stability, domestic production, revenue collection and fuel supplies as it works to maintain macroeconomic stability.
At its 24–25 August meeting, the Cabinet reported that state revenue collection had reached 72 percent of its annual target, while government spending stood at 48 percent of the yearly plan. Officials also reviewed the impact of floods and landslides in eight provinces, adding pressure to an economy already facing rising household costs.
The economic outlook remains mixed.
The government reported five percent economic growth in the first half of 2026 and is targeting six percent growth for the full year, driven by tourism, services and industry.
The Asian Development Bank, however, forecasts growth of four percent this year and expects inflation to average 9.8 percent, citing higher energy costs and global economic pressures. The World Bank has forecast growth of 3.8 percent.
