According to the Pakistan Bureau of Statistics (PBS), the Consumer Price Index (CPI)-based inflation rose to 38 percent on an annual basis in May 2023 from a rise of 36.4 percent the previous month and 13.8 percent in May 2022.
Compared to the month before, when it climbed by 2.4 percent, and to May 2022, when it increased by 0.4 percent, it increased by 1.6 percent in May 2023.
For the period of July to May 2022–2023, the average CPI inflation rate was 29.16% as opposed to 11.29% during the same time last year.
CPI Inflation Rate
May 2023 saw a rise in the CPI inflation rate in the urban sector of 35.1% on an annual basis, up from 33.5% the month before and 12.4% in May 2022.
Compared to the month before, when it increased by 2.0%, and May 2022, when it increased by 0.3%, it increased by 1.5% month over month in May 2023.
In May 2023, CPI inflation in the rural sector jumped to 42.2% on an annual basis, up from 15.9% in May 2022 and 40.7% in the preceding month.
Compared to the previous month’s gain of 3.0 percent and May 2022’s increase of 0.6%, it climbed by 1.7% month over month in May 2023.
In May 2023, the Sensitive Price Index (SPI) inflation rate jumped YoY to 43.0 percent, up from 42.1 percent a month earlier and 14.1 percent in May 2022.
In May 2023, it climbed on a month-over-month basis by 1.3%, compared to increases of 2.7% a month before and 0.6% in May 2022.
In May 2023, the Wholesale Price Index (WPI) inflation rate increased year over year to 32.8%, up from 33.4 percent a month earlier and 29.6 percent in May 2022.
In May 2023, it climbed by 1.0% month over month, compared to an increase of 0.1% the previous month and an increase of 1.4% in the same month the previous year, i.e. May 2022.
AFP adds, “This level of inflation badly affects poor and middle-class families of the country, whose income is evaporating with each percentage point,” said Mohammad Sohail, a financier in Karachi.
Pakistan’s economy has reached its breaking point as a result of years of financial mismanagement, which has been made worse by the global oil crisis and disastrous floods that drowned a third of the nation in 2022.
With opposition leader Imran Khan’s brief detention last month causing deadly street unrest and a days-long state-ordered mobile internet ban, a political crisis has added yet another degree of uncertainty.
The $6.5 billion loan agreement reached with the International Monetary Fund has been in stalemate for months due to discussions to release a critical tranche.
Pakistan’s foreign exchange reserves have shrunk to only $4.2 billion, hardly enough for a month’s worth of imports, and it needs billions in funding to pay off its alarming levels of external debt.
Elections must take place by October at the latest, and the administration has already acceded to IMF demands by ending popular gas and energy subsidies that helped to ease the cost-of-living crisis.
“Everyone is worried,” said 42-year-old Muhammad Safeer in an Islamabad bazaar. “Where will we get the money from? Personal debt can only go up.”
Next week, the administration of Prime Minister Shehbaz Sharif is expected to propose its annual budget, and the country has already revised its growth projection for the year ending June 30 from 5% to 0.3%.
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