Fuel, food push SPI higher by 14.75% YoY

Weekly inflation eases 0.56% due to lower prices of chicken, garlic and energy

KARACHI:

Pakistan's short-term inflation, gauged by the Sensitive Price Indicator (SPI), surged 14.75% year-on-year, reflecting the impact of heightened geopolitical tensions following the Israel-US conflict with Iran, and the resultant disruption to global oil supplies through the Strait of Hormuz, which has caused a sharp rise in energy and food prices that continued to burden households.

According to the latest SPI reading released by the Pakistan Bureau of Statistics (PBS), the index for the week ended June 4, 2026 stood 14.75% higher than the corresponding week of last year.

The high inflation comes at a time when global energy markets remain volatile amid prolonged conflict in the Gulf region, which is disrupting crude oil shipments through the Strait of Hormuz, a vital artery for nearly a fifth of the world's oil trade.

Pakistan, which relies heavily on imported crude oil and petroleum products, is particularly vulnerable to such external shocks.

PBS data showed that petroleum prices were among the biggest contributors to the annual inflation. Petrol prices were 50.6% higher than a year ago, while high-speed diesel (HSD) prices increased 49.63%. Liquefied petroleum gas (LPG) prices surged 57.09% during the same period, adding pressure on transport, logistics and household energy costs.

Food inflation also remained elevated. Onion prices more than doubled, rising 100.68% year-on-year, while wheat flour prices climbed 59.88%. Tomatoes became 20.62% more expensive, mutton prices increased 15.86%, and beef prices rose 12.87% compared to the same week of last year.

Despite the sharp annual increase, the weekly inflation eased by 0.56% compared with the preceding week, mainly due to lower prices of chicken, garlic, petrol and diesel. Chicken prices fell 9.48% week-on-week, while diesel and petrol declined 7.01% and 6.8%, respectively.

However, the relief was partially offset by sharp increases in vegetable prices. Onion prices jumped 28.16% week-on-week, potatoes rose 21.91%, and tomatoes gained 9.56%. Wheat flour, fresh milk, cooking oil, and LPG also recorded increases in consumer purchase costs.

Among income groups, the lowest consumption quintile recorded a 12.59% annual increase, while the overall SPI rose 14.75%, indicating that inflationary pressures remained widespread across households despite the week-on-week decline.

The monthly Consumer Price Index (CPI) surged by 11.7% on a YoY basis in May 2026 as compared to a rise of 10.9% in the previous month and 3.5% in May 2025. On a month-on-month basis, it edged higher by 0.5% in May as compared to an increase of 2.5% in the previous month and a decrease of 0.2% in May 2025.

Urban inflation soared by 11.8% year-on-year and inflation in rural areas went up by 11.5% YoY in May 2026.