Weekly inflation hits three-year low at 12.27%

KARACHI:

The weekly inflation, measured through the Sensitive Price Indicator (SPI), reached a three-year low, decelerating to 12.27% in the week ending September 19, 2024, compared to the same period last year.

According to the Pakistan Bureau of Statistics (PBS), short-term inflation on a week-on-week basis also dropped by 0.52%, primarily due to falling energy and food prices.

The return of inflation to a downward trend suggests that the previous uptick was temporary.

The week-on-week SPI decrease was led by a 5% drop in high-speed diesel, which fell to Rs250.76/ litre from Rs263.96/litre. Onion prices followed suit, declining by 4.45% to Rs143.75/kilogram.

Petrol prices also dropped, decreasing by 3.88% to Rs250.20/litre from Rs260.31/litre, while tomatoes saw a 1.93% reduction to Rs116.91/kg. The price of sugar fell by 0.70%, settling at Rs141.28/kg.

Other essential items, including potatoes, LPG, cooking oil, and various pulses, decreased by up to 0.57%.

However, prices of some essential goods increased by up to 1.50%, including pulses, cooked beef, eggs, garlic, gur, salt powder and shirting fabric.

SPI data covers 51 essential commodities, with PBS collecting pricing data from 50 markets across 17 cities.

Out of 51 items, prices for 17 (33.34%) increased, 15 (29.41%) decreased, and 19 (37.25%) remained unchanged compared to the previous week.

The year-on-year trend showed a 12.72% inflation increase, driven by a significant rise in gas charges (570%) and onions (74.62%).

Despite inflation remaining in double digits, experts predict further improvement, potentially reaching single digits in the coming months.

The Consumer Price Index (CPI) fell to 9.6% in August after a gap of three years, and experts forecast further deceleration below 8% in September, aided by delays in power price hikes and significant drops in global oil prices.