ISLAMABAD: Short-term inflation rose 29.65 per cent on a year-on-year basis in the week ending on Oct 27 despite a hefty cut in prices of petroleum products, according to official data released on Friday.

Measured by the Sensitive Price Index (SPI), the rate decelerated below 30pc following a steady increase over five successive weeks. On a week-on-week basis, the SPI slightly eased 0.33pc mainly because of a drop in petrol price.

Last week, the caretaker government made a hefty cut in the prices of petroleum products. The impact of this decline was visible in the prices of vegetables because of the drop in transportation charges.

In the forthcoming review, petrol prices are projected to experience a minor increase of around Rs2.43 per litre. Conversely, diesel prices are anticipated to decrease by Rs5.65 per litre. This comes in the wake of a recent surge in global oil prices, triggered by the crisis in the Middle East.

Of the 51 items in the SPI basket, prices of 14 goods increased while those of 17 dropped. The number of items whose prices remained unchanged compared to the previous week was 20.

During the week under review, the items whose prices increased the most over the same week a year ago were gas charges for Q1 (108.38pc), cigarettes (94.46pc), chillies powder (84.11pc), rice basmati broken (78.51pc), wheat flour (77.49pc), sugar (63.22pc), rice Irri-6/9 (62.83pc), gents sponge chappal (58.05pc), gur (57.73pc) and salt powdered (54.84pc).

The biggest increases week-on-week were seen in the prices of tomatoes (20.81pc), potatoes (3.33pc), eggs (1.63pc), salt powdered (0.91pc), garlic (0.77pc), tea prepared (0.67pc), bread plain (0.56pc) and mutton (0.28pc).

In May, the SPI stayed above 45pc for three weeks after hitting an all-time high of 48.35pc on May 4.

The rupee’s depreciation, rising petrol prices, sales tax, gas bills and electricity bills are among the key contributors to this inflationary trend.

Meanwhile, on a week-on-week basis, the prices of chicken dropped by (10.19pc), onions (4.4pc), rice IRRI-6/9 (3.84pc), bananas (3.64pc), gur (3.4pc), pulse masoor (2.36pc), sugar (2.22pc), and mustard oil (2.17pc).

Published in Dawn, October 28th, 2023