Because of the global trend of lower petroleum prices and a drop in the dollar rate as a result of a crackdown on currency smugglers and hoarders in Pakistan, the inflation rate has decreased, which will provide some relief to the people during these difficult times.
Weekly Inflation Rate Decreased by 1.7%
The inflation rate, as measured by the Sensitive Price Indicator (SPI), fell 1.7% from the previous week during the week ended October 19, 2023. Inflation fell from 38.28% to 35.45% on an annual basis.
According to the Pakistan Bureau of Statistics (PBS) weekly report, prices of 24 items fell during the week under review, while prices of 14 items increased. The remaining 13 items in the SPI basket’s rates remained unchanged.
Items Inflated and Deflated
The price of a kilogram of onion fell by Rs. 9.48, while the price of chicken fell by Rs. 20.6. Similarly, lentil prices fell by Rs. 11.03 per kg. Tea and rice prices fell this week as well.
However, the prices of 14 items, including eggs, mutton, and beef, increased, while bread and milk powder remained unchanged.
Earlier in October, it was reported that monthly inflation, as measured by the Consumer Price Index (CPI), had rebounded to 31.4% in September, the highest level in four months, due to an administrative increase in electricity and fuel prices.
It had a significant impact on consumers at a time when poverty and unemployment were already significantly higher.
Increase in Energy Prices
The CPI rose primarily due to an increase in energy prices, while the rate of increase in perishable food items slowed to a single digit.
Electricity is now 164% more expensive than it was in September of last year. Similarly, even before the upcoming increase in gas prices, the price of gasoline was 63% higher than a year ago.
Petrol is also significantly more expensive than a year ago, costing Rs. 283 per litre. Non-perishable food prices, such as politically sensitive sugar, have continued to rise.
The CPI reading suggests that the government and the State Bank of Pakistan are on track to miss the annual inflation target of 21% by a wide margin, despite imposing significant costs on the exchequer and businesses by maintaining interest rates at 22%.
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