ISLAMABAD: Pakistan’s annual inflation edged up to 4.2 per cent in February from 3.7pc in the preceding month on the back of an increase in petroleum and perishable food prices, the Pakistan Bureau of Statistics (PBS) said on Thursday.

The main inflation is measured through Consumer Price Index (CPI) which tracks prices of around 480 commodities in urban centres. The index rose 0.3pc month-on-month in February compared to a 0.2pc increase in the previous month and a decrease of 0.3pc in February 2016.

The annual inflation target for the current fiscal year is 6pc. In the preceding fiscal year, average annual inflation was recorded at 2.86pc.

Average annual inflation in the first eight months of the current fiscal year (July-February) stood at 3.9pc against 2.48pc in the same period a year ago.

Inflation in the food group, whose weight in the CPI basket is 34.83pc, stood at 3.7pc year-on-year in February. On a month-on-month basis, food inflation increased 0.3pc in February due to an increase of 2.42pc in the prices of perishable products and 7.86pc in non-perishable products.

Food items whose prices increased in February included tomatoes 28.98pc, chicken 7.91pc, onion 6.31pc, rice 3.53pc, fresh fruit 2.62pc, and tea 1.4pc.

Core inflation, measured by excluding the volatile food and energy prices, was recorded at 5.3pc in February, up 0.2pc from the preceding month. Core inflation has remained subdued since November 2015 because of a tighter monetary policy and reduction in food and fuel prices.

Government borrowing is one of the key factors influencing the trend of core inflation as there is a positive relation between the two. Non-food inflation was recorded at 4.6pc in February. It witnessed an increase of 0.3pc over the preceding month.

Among non-food groups, motor fuel prices went up 3.12pc, medical tests 1.64pc, doctor’s fee 1.6pc, personal equipment 1.34pc and personal care 1pc.

The education and health indices rose 11.33pc and 14.11pc, respectively, in February on a year-on-year basis. The second-highest increase of 12.44pc was witnessed in the index of alcoholic beverages and tobacco.

The index of clothing and footwear rose 4.16pc and that of housing, water, electricity, gas and other fuels surged 4.83pc.

Meanwhile, the Sensitive Price Index edged up 1.2pc and the Wholesale Price Index rose 3.46pc in February.

Published in Dawn, March 3rd, 2017

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