Inflation rises 11.5%

KARACHI: Inflationary pressure has intensified as high electricity, petroleum and food prices took the overall inflation to 13.3 per cent during the first nine months (July-March) of fiscal year 2010, said the Economic Survey on Friday.

In 10 months (July-April) overall inflation rose 11.5 per cent against 22.3 per cent in the corresponding period of 2008-09.

Consumer Price Index (CPI) inflation accelerated to 13.3 per cent in April 2010 from a low of 8.9 per cent in October 2009, posing a challenge for the government to contain inflation in single digit.

Food inflation remained high over the past few months, standing at around 14.5 per cent from 7.5 per cent in October 2009, while the rate of change in prices of non-food items was recorded at 12.2 per cent for April from 10 per cent in October.

Wholesale Price Index (WPI) rose steeply by 22 per cent in April 2010 while Sensitive Price Index (SPI) increased by 16.7 per cent versus 6.7 per cent in October 2009.

A sharp spike in global commodity prices, mainly relating to food and energy, has exerted strong upward pressure on the domestic price level.

Given this backdrop of global price developments, it should be of little surprise that the sharp resurgence of inflation is not restricted to Pakistan and is both a global as well as a regional phenomenon.

India’s food price inflation soared to 19.2 per cent in December 2009, before settling at 16.7 per cent in March. Similarly, food inflation in Bangladesh rose from 3.3 per cent in July 2009 to 10.9 per cent in February 2010.

Published in the Express Tribune, June 5^th, 2010.