Laos Inflation Drops to 9 Percent, But Living Costs Remain High

This Week

Laos recorded an inflation rate of 9 percent in May, down from 10.2 percent in April, marking the first slowdown in consumer price growth in recent months, according to figures released by the Lao Statistics Bureau (LSB).

The report said the easing inflation rate was largely driven by falling domestic fuel prices and more stable exchange rates throughout May.

Fuel prices, which have been one of the biggest drivers of inflation in Laos over the past months, declined throughout May after several rounds of price adjustments.

According to the report, authorities adjusted fuel prices four times between 1 and 25 May. Diesel prices fell during all four adjustments, while gasoline prices rose twice and dropped twice.

Average gasoline prices declined from LAK 40,483 (USD 1.84) per liter in April to LAK 34,776 (USD 1.58) in May, a drop of 14.1 percent. Diesel prices also fell sharply from LAK 48,619 (USD 2.21) per liter to LAK 37,662 (USD 1.71), down 22.5 percent.

Lower fuel prices helped reduce transport costs by 6.3 percent during the month. Bus fares, domestic flight tickets, and traveling overall also became cheaper, according to the latest LSB report.

Authorities also noted that the Lao kip strengthened slightly against both the USD and THB during May, helping reduce pressure on imported goods and fuel costs.

Cost of Living Pressure Continues 

Despite the slowdown in overall inflation, the cost of living remains high for many households across Laos.

Utility costs remained one of the biggest pressures on households in May, with the category rising to 20.4 percent. Electricity and water prices also continue to rise sharply.  

Food prices also remained high. Fresh vegetables rose to 23.5 percent, while fruit prices increased 9.9 percent. Meat, poultry, and seasoning products also recorded price increases.

Imported goods inflation still remains, showing Laos’ dependence on foreign products and global market fluctuations.

Although inflation has dropped sharply from the crisis levels seen in 2024, many families across Laos are still facing high utility bills, food costs, and imported goods prices. 

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