ISLAMABAD: Inflation as measured by the Sensitive Price Index (SPI) rose 3.68 percent from the previous week, mainly due to the highest-ever rise in food prices, according to data from the Pakistan Bureau of Economic Affairs. Statistics (PBS) released Friday.
The increase in weekly inflation is the highest since the base year change. On 17 June, the second highest rise in the SPI was recorded at 3.38 pc. The SPI recorded the highest year-on-year increase ever of 37.67 pc in the reviewed week.
The government massively increased petrol and diesel prices, which also contributed to a rise in food inflation.
Food prices continue to rise as rain damages crops
Recent rains across the country have also damaged standing crops, so vegetable prices are likely to remain on the high side amid supply shortages. The huge increase in the electricity tariff is another factor that has contributed to the price spike.
The government has already announced in the budget that it will revive the sales tax on petroleum products and that it will gradually impose a petroleum development tax. As a result, the price of diesel is expected to rise in the coming quarter. This will further increase food prices due to high transportation costs.
The government set a modest inflation target of 11.5 pc in the budget documents. for FY23.
However, the Federal Board of Revenue, which uses inflation as one of its measures to collect additional taxes from consumers, has estimated inflation at 12.8 percent. Independent economists predicted that annual inflation would be between 25 and 30 percent.
Shortly after the new government came to power, the new government dissolved the special National Price Control Commission, which was headed by the finance minister, while the provinces were represented by provincial chief secretaries. The committee meets every Monday to monitor the prices of essential food items.
The PBS data shows that the prices of 30 essential foods have increased in the past week from the week before.
The price of tomatoes increased by 17.53pc, pulse masoor 4.18pc, pulse mash 2.87pc, pulse gram 2.46pc, pulse moong 2.02pc, vegetable ghee 2.5kg 1.80pc, garlic 1.69 st and rice basmati broken 1.21 st. In non-food items, the price of electricity rose by 26.11 pc, LPG by 7.02 pc, laundry soap by 2.34 pc. and energy saver by 1.03 pc.
The SPI rose by 3.27 pc. for the lowest income group (ie people earning less than Rs 17,732 per month) and by 3.54 pc for the group with a monthly income of more than Rs 44,175.
The year-on-year increase in diesel was 101.53 pcs, pulse masoor 99.14 pcs, gasoline 94.15 pcs, chicken 75.65 pcs, cooking oil 5 liters 74.81 pcs, vegetable ghee 1 Kg 72.90 pcs , mustard oil 72.45 pcs, vegetable ghee 2.5 Kg 70.51 pcs, onions 64.18 pcs, laundry soap 62.46 pcs, pulse gram 55.28 pcs, electricity 52.61 pcs, men’s sponge chappal 52.21 pcs, garlic 45.18 pcs and pulse mash 38.35 pcs.
Published in Dawn, July 30, 2022