Pakistan crisis: Inflation in crisis-ridden Pakistan has risen to almost 40 percent

Pakistan has been trying to contain inflation in recent weeks, but with little success. The latest spike in inflation comes even as the Pakistani government introduced new taxes and hiked oil prices to meet International Monetary Fund (IMF) demands before spending $1.1 billion as part of an already agreed $7 billion dollar deals released.

Pakistani authorities shocked people last week by introducing new taxes to raise 170 billion rupees through a mini-budget law. Unprecedented inflation has hit every household.

The Sensitive Price Index (SPI), which is used to measure short-term inflation, rose to 38.42 percent yoy (YoY) over the past week, reported The Express Tribune newspaper, citing the latest data from Pakistan’s Bureau of Statistics.

In the past week, 34 items have had their prices increased, five have been reduced and 12 have remained the same. The rising prices hit the group with a monthly income of Rs 29,518 to Rs 44,175 the hardest with an inflation effect of 39.65 per cent.

On a weekly basis, the SPI rose 2.89 percent compared to a 0.17 percent increase in the previous one. In the previous week, the annualized SPI inflation was 34.83 percent.

The increase in prices is attributed to the increase in fuel prices announced by the government. This, in turn, caused the prices of essential items to skyrocket. The SPI is used to measure the prices of 51 key items based on a survey of 50 markets in 17 cities across the country.

For example, the weekly price of petrol rose by 8.82 percent, five liters of cooking oil by 8.65 percent, a kilo of ghee by 8.02 percent, chicken by 7.49 percent and diesel by 6.49 percent.

The price of tomatoes fell 14.27 percent week-on-week (WoW). This was followed by a 13.48 percent week-on-week price cut for onions. Similarly, egg prices were down 4.24 percent, garlic was down 2.1 percent, and flour was down 0.1 percent on a WoW basis.

The highest year-on-year price increase was observed in the price of onions, which increased by 433.44 percent. This was followed by chicken meat, the price of which increased by 101.86 percent annually. Diesel was up 81.36 percent year-on-year and eggs were up 81.22 percent.

Items whose prices dropped year-over-year included tomatoes, down 65.3 percent and chili powder, down 7.42 percent.

According to statistics during the reporting week, the annualized inflation rate for the group earning up to Rs 17,732 per month was 35.01 percent. For the group with incomes ranging from Rs 17,733 to Rs 22,888 per month, the inflation rate was 36.53 per cent.

(Inputs from PTI)