On the seven days that ended on February 16, weekly inflation reached a 16-week high to stand at 2.89 percent, with prices of fuel and edible oils rising by up to 8%, according to official figures.
According to data released on Friday by the Pakistan Bureau of Statistics (PBS), annualized sensitive pricing indicator (SPI) inflation increased 38.42 percent, reaching a 22-week high.
SPI indicators on Inflation
The spike in SPI was related to weekly increases in the costs of cigarettes (6.18 percent), bananas (8.01 percent), chicken (7.49 percent), vegetable ghee 1 kg (8.02 percent), vegetable ghee 2.5 kg (6.76 percent), diesel (6.49 percent), cooking oil (5 liters) (8.65 percent), and petrol (8.82 percent).
Since October 27, 2022, according to Arif Habib Limited, this was the greatest WoW number. Once the government increased the energy price for the quarter at the end of October of last year, consumers noticed a 4.13 percent increase in the SPI.
Regular Pakistanis, who have been hardest hit by inflation, are finding it difficult to make ends meet as the price of essentials continues to rise and earnings remain stagnant or nonexistent.
The WoW SPI climbed by 2.45, 2.73, 2.79, 2.88, and 2.94 percent, respectively, for the groups spending up to Rs. 17,732, Rs. 17,732–22,888, Rs. 22,889–29,517, Rs. 29,518–44,175, and beyond Rs. 44,175.
On the other hand, the YoY SPI increased by 35.01, 36.53, 38.43, 39.65, and 39.41 percent for the various expenditure groups.
SPI was measured at 234.77 points for the week under review as opposed to 228.17 points the week prior and 169.61 points for the week ending February 17, 2022.
The PBS data attributed the close to 39 percent YoY rise in SPI to jump in the prices of onions (433.44 percent), chicken (101.86 percent), diesel (81.36 percent), eggs (81.22 percent), rice irri-6/9 (74.12 percent), broken basmati rice (73.05 percent), and petrol (69.87 percent).
The pulse moong (67.98 percent), bananas (67.68 percent), Lipton tea (63.89 percent), pulse gram (56.93 percent), bread (55.36 percent), pulse mash (53.42 percent), LPG (52.68 percent) and cigarettes (50.02 percent).
Food and energy inflation are crushing typical household budgets, raising concerns that recent government efforts to appease the International Monetary Fund (IMF) for a meagre $1.1 billion rescue tranche will result in widespread poverty.
The lower and moderate income classes, many of whom rely on rickshaws and ride-sharing apps to get to and from work, are disturbed by any increase in the price of petrol and diesel.
A teacher at a private institute, who wished to remain anonymous said, “If the price of petrol goes up again, and the cost of transportation continues to rise at this rate, I will have no option but to quit my job.”
She shared the math and stated that, despite earning Rs. 35,000 at the private school, she was currently spending up to Rs. 11,000 per month on transportation because she resided in a place that was underserved by the system of public transit.
She said that this indicated that 32% of her revenue was related to transportation.
According to most budgeting manuals, the percentage for transportation expenses, such as bus and taxi fares, gas, insurance maintenance, etc., should be between 15 and 20 percent.
Unfortunately, due to inadequate public transportation design, this is typically not the case for the majority of people in reality.
In his weekly report, Fahad Rauf, head of research at Ismail Iqbal Securities, stated that the spike in petrol and cooking oil costs is the main cause of the Significant increase in SPI.
Onions, on the other hand, saw a 13.5 percent WoW fall in price.
“The inflationary pressures are expected to intensify as the government has taken tax measures and made electricity, petroleum and gas price adjustments to unlock the IMF program,” Rauf’s note added.
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