Inflation rises for 2nd week in row

KARACHI:

Pakistan's weekly inflation reading, measured through the Sensitive Price Indicator (SPI), increased by 0.44% due to a hike in food prices, maintaining an uptrend for the second successive week ended on October 3, 2024.

According to the Pakistan Bureau of Statistics' (PBS) weekly data update on Friday, the rate of inflation surged 13.18% in the week under review, compared to the same week of last year.

The gradual return of short-term inflationary pressure is squeezing people's disposable income, impacting their purchasing power, and making their lives miserable, especially those belonging to low-income groups.

If the uptrend continues, it would force the State Bank of Pakistan (SBP) to go slow on monetary easing in November instead of aggressively cutting interest rate in line with market expectation for the fourth consecutive time by around 1.5 percentage points to 16% early next month.

The week-on-week SPI inflation was up 0.44% under the lead of tomatoes, which became costlier by 18.51% in the week under review to Rs146.56/kg compared to Rs123.67/kg last week.

This was followed by onion, which surged 5.89% to Rs160.57/kg in the week compared to Rs151.64/kg last week.

Chicken (live broiler) price went high by 3.72% to Rs466.60/kg compared to Rs449.85/kg. Wheat flour increased 3.63% to Rs1,793.61/20kg bag compared to Rs1,730.81/bag.

Garlic rose 2.47% to Rs569.91/kg in the week under review compared to Rs556.16/kg in the prior week.

Other essential commodities enhanced by up to 1% including gram pulse, LPG, matchbox, moong pulse, mustard oil, firewood and cigarettes.

SPI comprises 51 essential items. PBS collects prices of them from 50 markets in 17 cities of the country.

During the week, prices of 21 (41.18%) items increased, 10 (19.61%) items decreased and 20 (39.21%) items remained unchanged compared to the previous week.

The year-on-year trend depicts an increase of 13.18% in SPI inflation reading with gas charges for Q1 rising 570%, followed by gram pulse becoming costlier by 65.33% compared to the same week of last year.

Other essential goods surged by up to 43.49%, including onions, tomatoes, powdered milk, beef, chicken, shirting, moong pulse, salt powder, georgette and energy savers.