Short-Term Inflation Hits 12.31pc in Pakistan

Short-term inflation in Pakistan climbed to 12.31 per cent year-on-year in the week ending November 5, as dearer liquefied petroleum gas (LPG) and perishable food pushed household costs higher.

The Pakistan Bureau of Statistics (PBS) released the figures on Friday. The Sensitive Price Index (SPI), which tracks short-term inflation, rose 0.29 per cent over the previous week.

The index covers 51 essential items, with prices collected from 50 markets in 17 cities. Of those items, 21 became dearer during the week, 10 became cheaper and 20 stayed unchanged.

Tomatoes and LPG lead the weekly rise

Tomatoes recorded the sharpest weekly rise, jumping 54.18 per cent in seven days. LPG followed with a 3.72 per cent increase, while potatoes rose 2.07 per cent and eggs 1.17 per cent.

Garlic became dearer by 1.06 per cent, firewood by 1.01 per cent and salt powder by 0.91 per cent. Plain bread rose 0.64 per cent, fresh milk 0.49 per cent and curd 0.41 per cent.

Fuel brought some relief. Petrol fell 4.20 per cent over the week and diesel dropped 2.97 per cent. Pulse gram became cheaper by 1.08 per cent, bananas by 0.85 per cent and onions by 0.82 per cent.

Powdered milk fell 0.73 per cent, chicken 0.61 per cent, sugar 0.40 per cent, wheat flour 0.34 per cent and pulse moong 0.27 per cent.

Short-term inflation in Pakistan stays in double digits

Short-term inflation has now stayed in double digits for several consecutive weeks. A week earlier, it stood at 11.32 per cent year-on-year.

The annual picture is stark. LPG costs 114.88 per cent more than a year ago, while tomatoes are up 78.89 per cent. Electricity charges for the first quarter rose 52.38 per cent, diesel 39.27 per cent, petrol 36.34 per cent, wheat flour 33.95 per cent and chicken 31.81 per cent.

Chillies powder rose 15.55 per cent over the year, mutton 14.54 per cent, onions 13.64 per cent, plain bread 12.35 per cent and beef 11.06 per cent.

Some items became much cheaper over the year. Potato prices fell 37.24 per cent, eggs 27.59 per cent and sugar 25.03 per cent, while salt powder fell 14.09 per cent and gur 7.75 per cent.

Why energy costs keep feeding food prices

The rise is a clear case of cost-push inflation, in which higher energy costs feed into food prices. The government has kept raising petrol and diesel prices rather than cut the petroleum levy, and the surge in energy costs has added to household bills and to sales tax collection through higher prices.

Oil prices have fallen slowly over the past three days, and the effect of that decline should show in the next weekly review. But the sharp rise in LPG prices has outweighed the fuel relief for now.

The pattern matters because LPG is the cooking fuel for millions of homes without piped gas. At nearly 115 per cent above last year’s price, it now takes a far bigger share of a household budget than it did a year ago.

Petrol and diesel, by contrast, have started to ease. The government cut petrol and diesel prices earlier this week, and the weekly SPI data reflect that relief, with both fuels down sharply on the week.

The wider economy offers little comfort. Pakistan’s external debt nearly doubled in a decade to $135.1 billion, according to the World Bank, while foreign exchange reserves have steadied at a record high.

The government is also pushing a roadmap for fully digital payments to cut the economy’s reliance on cash.

For now, the weekly numbers show a familiar squeeze: kitchen staples and cooking gas rising fast, with only fuel prices offering a partial offset.

What is the Sensitive Price Index?

The Sensitive Price Index tracks weekly changes in the prices of 51 essential commodities and services. The Pakistan Bureau of Statistics collects the prices from 50 markets in 17 cities.

Why did short-term inflation rise this week?

LPG and perishable food items, led by tomatoes, drove the rise. The index rose 0.29 per cent on the week and 12.31 per cent on the year.

Which items rose the most over the year?

LPG rose 114.88 per cent, tomatoes 78.89 per cent and electricity charges for the first quarter 52.38 per cent. Diesel and petrol rose 39.27 per cent and 36.34 per cent.

Did any prices fall?

Yes. Petrol fell 4.20 per cent and diesel 2.97 per cent over the week. Over the year, potatoes fell 37.24 per cent, eggs 27.59 per cent and sugar 25.03 per cent.