July 12, 2008	Saturday	Rajab 8, 1429

ISLAMABAD, July 11: Inflation jumped to an all-time high of 12 per cent during the outgoing fiscal year (2007-08) from 7.7 per cent in the previous year on the back of spiralling food and energy prices.

Rising demand, falling supply, five-time increases in oil prices over the past few months and surging energy costs have pushed prices of essential food items to an unprecedented level, eroding the purchasing power of middle and lower income groups.

The government had projected the annual inflation target for 2007-08 at 6.5 per cent, but raised it to 12 per cent for 2008-09.

Officials said that it would be impossible to bring down the inflation from the current level because of the rising trend in international oil prices, coupled with global food shortages.

Figures released by the Federal Bureau of Statistics on Friday showed that the Consumer Price Index (CPI) rose by 21.53 per cent last month, the highest increase in a single month.

Food inflation ballooned to a record 32 per cent, the highest not only in the country but also in the region. In May, the figure was 28 per cent.

Prices of non-perishable food items witnessed an increase of 35.39 per cent and perishable items 9.59 per cent in June. All food items, including potatoes, spices, tea, sugar, onions, masoor, powdered milk, wheat, beverages, vegetable ghee, cooking oil, milk and honey, milk products, bakery items, wheat flour, meat, rice, cereals, gram whole, gur, eggs, readymade food and mustard oil, saw unprecedented hikes.

The global food price index rose by 54.1 per cent.

The core inflation (non-food and non-energy) swelled to 13 per cent last month, compared to 5.7 per cent in the corresponding month last year, on account of rising house rent and medicare sub-indices.

The house rent increased by 12.39 per cent and medicare by 14.16 per cent.

The non-food inflation spiked to 10 per cent on the back of a five-time increase in petroleum prices. Transportation charges recorded an increase of 24.91 per cent and education 9.23 per cent in June.

The Wholesale Price Index (WPI), the most commonly used measure to monitor the cost of production, rose to a record 16.41 per cent in 2007-08. Prices of 425 items increased at the wholesale level. The WPI witnessed an unprecedented increase of 30.62 per cent in June.

The average weekly inflation of essential commodities saw an increase of 16.81 per cent in 2007-08. It rose by 30.02 per cent in June.