KARACHI: All provincial capitals, except Quetta, were among high inflation cities of Pakistan, but the federal capital was hit by the highest inflation while Karachi remained at the bottom in the list of high inflation cities in June 2014, according to Inflation Monitor issued by the State Bank recently.

The Consumer Price Index (CPI) based inflation in Islamabad was 14.6 per cent while the country’s inflation for June (year-on-year basis) was 8.2pc.

A wide variation in inflation was noted among different cities as CPI was lowest in Bahawalnagar with 3.8pc and highest in Islamabad with 14.6pc.

Despite being among high inflation cities, Karachi was hit by 8.5pc inflation in June, second lowest in the list. Last city in the list of high inflation was Mingora with 8.3pc inflation.

In most cities, inflation was dominated by non-food inflation, excluding Karachi, where food inflation was the main cause of higher CPI.

The non-food inflation in Islamabad was 18.8pc compared to just 7.3pc in Karachi.

Lahore and Peshawar both witnessed high inflation of 10.1pc and 9.3pc respectively.

The cities with very high non-food inflation were Mardan 14.2pc, Nawab Shah 13.1pc, Faisalabad 12.4pc, Mianwali 11.9pc and DG Khan 11.8pc.

The high non-food inflation reflects that cost of production and construction is very high which means either cities are rich to pay high prices of non-food items or supply problem escalates prices.

Quetta is the only provincial capital which was enlisted among low inflation cities and had an inflation of 6.3pc.

The cities hit by the double-digit food inflation were Khuzdar 12.8pc, DG Khan 12pc, Lahore 10.6pc, Sukkur 10.3pc and Attock 10.1pc.

Other details show that the middle income group pays highest price of both food and non-food items.

The income group in the basket of Rs18,000 to Rs35,000 per month witnessed highest inflation of 8.6pc in June 2014.

The same group faced non-food inflation of 9.6pc which is the highest among all income groups. It means this income group had to pay highest price of non-food items.

The main inflation for the income group above Rs35,000 was 8.3pc while non-food inflation was 8.7pc, much lower than the inflation for income group up to Rs35,000.

Published in Dawn, August 3rd, 2014