ISLAMABAD: Weekly inflation continued to rise unabated largely due to the increase in food and energy prices, reaching a record 45.50 per cent year-on-year (YoY) on the week ended on Sept 1, showed data released by the Pakistan Bureau of Statistics (PSB) on Friday.

Before this, the highest ever year-on-year increase in weekly inflation, measured by PBS’s Sensitive Price Index, was 44.58pc, recorded for the week ending on August 25 and 42.31pc in the week ending on August 18.

The latest data shows that the SPI rose by 1.31pc on a week-on-week basis, mainly because of higher food prices. The week ending July 28 saw the highest week-on-week increase in inflation, at 3.68pc.

Soaring vegetable prices due to damage to standing crops after heavy rains and floods and a massive hike in electricity rates have also contributed to higher prices. The damage to standing crops will push up the prices of vegetables in the coming weeks.

Crop damages lead to shortage of vegetables

The government has exempted duty and taxes on the import of tomatoes and onions. The duty and tax relief per kg will be close to Rs10, with little impact on tomatoes. However, the import of these products will accelerate further in the coming days.

The government has set a modest annual inflation target of 11.5pc for the current fiscal year. However, the Federal Board of Revenue, which uses inflation as one of the measures to gather additional taxes from consumers, has projected inflation at 12.8pc. Independent economists estimate inflation to remain around 25pc to 30pc.

The International Monetary Fund said in its country’s staff report that the average Consumer Price Index (CPI) inflation was expected to surge to 20pc in the current financial year while core inflation would also remain elevated due to higher energy prices and the rupee’s decline.

On Aug 22, the government also revived the National Price Monitoring Committee. However, the committee has since then met once.

The SPI monitors the prices of 51 essential items based on a survey of 50 markets in 17 cities across the country. During the week under review, the prices of 31 out of 51 items increased, three decreased, and 17 remained stable.

The highest week-on-week increase was noted in the prices of onions at 42.17pc, tomatoes 13.25pc, pulse moong 7.94pc, potatoes 6.97pc, eggs 3.84pc, chicken 3.25pc, pulse gram 2.89pc, wheat flour 1.49pc, pulse mash 1.26pc, and bread 1.22pc.

As for non-food items, the price of LPG jumped 4.45pc, diesel 1.19pc and petrol 0.88pc.

On a year-on-year basis, the items whose prices jumped the most included onions 240.15pc, tomatoes 219.99pc, diesel 114.08pc, petrol 98.73pc, pulse masoor 82.44pc, cooking oil 5 litre 70.60pc, mustard oil 67.50pc, washing soap 64.81pc, vegetable ghee 2.5 Kg 63.70pc, electricity 63.01pc, vegetable ghee 1 kg 61.16pc, pulse gram 58.54pc, pulse mash 49.36pc, and LPG 45.23pc.

Published in Dawn, September 3rd, 2022