KARACHI, Dec 19: The core inflation, measured both as non-food non-energy (NFNE) and 20 per cent trimmed mean, declined in November to 5.6 per cent and 6.1 per cent, respectively, compared with 7.6 per cent and 6.8 per cent in corresponding month last year, according to State Bank's monthly publication “Inflation Monitor” released on its website Tuesday.
The Inflation Monitor says that the headline inflation in November 2006 persisted at its previous month rate of 8.1 per cent with slight rise in food inflation that was counterbalanced by a decline in non-food inflation.
The non-food inflation continued its declining trend that has been witnessed since end of last fiscal year while food inflation edged up to 10.6 per cent in November 2006 from 10.5 per cent in October 2006.
Unlike CPI, the WPI and SPI inflation increased in month under review; particularly SPI inflation increased significantly from 11.8 per cent in October 2006 to 13.4 per cent in November 2006. The rise in SPI was due to sharp increase in prices of certain food items, according to the Inflation Monitor.
Within food group, prices of 51 commodities, including fresh milk, sugar, beef, fish, pulses (gram, mash and moong), onion and chillies exhibited double digit inflation in November 2006. The combined weight of such commodities (with double-digit inflation) is about 48 per cent of the food group.
On other hand, prices of 12 commodities declined during month under review. The rest of items, having a weight of 43 per cent in food group exhibited subdued or moderate inflation.In non-food group, House rent index (HRI) maintained its declining trend, which started after February 2005, and recorded a moderate increase of 6.6 per cent in November 2006 compared with about 10.8 per cent in corresponding month last year. Other sub-indexes of non-food group that exhibited deceleration in November 2006 included apparel, textile and footwear, fuel and lighting, transport and communications, recreation and entertainment and medicare.
Fuel and lighting inflation declined to 10.5 per cent in November 2006 from 11.3 per cent in October 2006. Most notable declines were recorded in transport and communications: YoY inflation of 3.7 per cent in November 2006 compared with 22.7 per cent in the same month of last year. On the other hand, education sub index registered a significant increase of 7.3 per cent in the month under review compared to 6.6 per cent growth in the same month last year, says the Inflation Monitor.
After declining for four consecutive months, wage inflation remained at 13.0 per cent in November 2006. The wage inflation of skilled labour declined marginally whereas unskilled workers depicted a higher YoY growth of 16.6 per cent in month under review. Further break-up exhibited that wages of carpenters, labourers and plumbers increased with higher than previous month rate while masons and electricians showed deceleration in their wage inflation.—PPI
