Inflation stays above 40pc for second straight week

Annual short-term inflation in Pakistan stayed above 40% for the second consecutive week, largely driven by a substantial increase in gas prices, according to data from the Pakistan Bureau of Statistics (PBS). The inflation rate reached 41.13% for the week ending Nov 23, with gas prices standing over 1,100% higher than a year ago.

Notable price increases were observed in several items, including cigarettes (94%), wheat flour (88.2%), and chilli powder (81.7%). Other items with significant price hikes included broken basmati rice (76.6%), garlic (71%), and Irri-6/9 rice (62.3%).

On a week-on-week basis, consumer prices remained unchanged in the outgoing week, in sharp contrast to the previous week’s reading when prices skyrocketed by 10% due to the gas price hike coming into effect.

The short-term, or weekly, inflation is measured by a basket of goods and services called the Sensitive Price Indicator (SPI), which currently stands at 308.90 compared to 309.09 in the preceding week.

The SPI index, comprising 51 items collected from 50 markets in 17 cities, is computed weekly to assess the prices of essential commodities and services at shorter intervals.

The PBS data revealed that the prices of 18 items increased, 12 items decreased, and 21 items remained stable compared to the previous week. Garlic (4.6%), onion (2.4%), and chicken (1.8%) saw the highest week-on-week increases.

In comparison, the items whose prices dropped the most included tomatoes (-5.8%), vegetable ghee (-1.4%), and cooking oil (-1.3%). On an annual basis, the SPI inflation hit a record 48.35% in early May but then cooled to as low as 24.4% in late August before crossing 40% during the week ending Nov 16.