Weekly inflation stays above 48pc for 2nd consecutive week

ISLAMABAD: The weekly inflation, measured by Sensitive Price Indicator (SPI), witnessed an increase of 0.27 pc to jump to 48.02pc on a year-on-year basis for the week ending on May 11, official data showed.

The short-term inflation rose by an all-time high of 48.35pc for the period that ended on May 4. Out of the 51 monitored items, the average price of 23 items increased, 7 items decreased whereas 21 items registered no change during the week.

During the week under review, the items whose prices increased the most over the same week a year ago were: potatoes (112.80pc), gas charges for Q1 (108.38pc), tea Lipton (106.09pc), wheat flour (101.20pc), gents sponge chapal (100.33pc), diesel (99.39pc), bananas (98.22pc), rice basmati broken (90.76pc), eggs (89.40pc), petrol (87.81pc), rice irri-6/9 (83.47pc), pulse moong (66.91pc), bread (62.83pc) and pulse mash (58.79pc).

A decrease was observed in the prices of onions (9.40%), chicken (2.25%), LPG (1.51%), garlic (1.39%), bananas (0.68%), pulse gram (0.13%), and mustard oil (0.05%).

The SPI has steadily been on the rise since the start of Ramazan due to continued rupee devaluation, costly petrol prices, increase in sales tax and higher electricity charges.

Of the 51 items in the SPI basket, prices of 23 goods soared, seven dropped and 21 remained unchanged compared to the previous week.

On a week-on-week basis, the biggest rise was observed in the prices of tomatoes (6.32pc), gur (3.41pc), wheat flour (2.76pc), tea prepared (2.66pc), potatoes (2.14pc), cooked beef (2.12pc), cooked daal (1.98pc), powdered milk (1.91pc), eggs (1.83pc), rice basmati broken (1.42pc), pulse masoor (1.19pc), beef (1.18pc) and washing soap (1.04pc).

According to a finance ministry report, the lower-income segment of society is already feeling the brunt of high inflation, which has become unrelenting on the back of political instability, financial mismanagement and delay in an agr­e­e­ment with the Interna­tional Monetary Fund.

Slow recovery from the flood-led damages had caused the supply of essential crops to remain short of domestic requirements, consequently intensifying inflation, the report added.

On the other hand, the State Bank of Pakistan was enacting a contractionary monetary policy, “but inflationary expectations are not settling down”, the report noted.

The government has been taking harsh measures — hikes in fuel and power tariffs, withdrawal of subsid­ies, market-based excha­nge rate and higher taxation — under the IMF progra­m­me to generate revenue for bridging the fiscal deficit, which may result in slow economic growth and higher inflation in coming months.

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