Weekly inflation posts fourth consecutive increase

Published June 22, 2024
Despite petroleum price cuts in the last two fortnights, food items, especially vegetables, maintained an upward trend.—PPI/file
Despite petroleum price cuts in the last two fortnights, food items, especially vegetables, maintained an upward trend.—PPI/file

ISLAMABAD: Short-term inflation, measured by the Sensitive Price Index (SPI), posted a straight fourth weekly increase primarily due to a rise in vegetable prices, official data showed on Friday.

The SPI-based inflation surged 23.78 per cent year-on-year in the week ending June 20.

The short-term inflation recorded a 0.94pc rise week-on-week.

The Finance Bill 2024 proposes a series of indirect taxes expected to fuel inflation in the coming weeks. For example, an 18pc sales tax would further push the prices of pharmaceuticals, books and stationery and poultry products.

The real impact of the decline in petrol prices on essential commodities would be neutralised due to the rising prices of perishable vegetables like tomatoes, onions and potatoes. The increase in sales tax and customs duty on importing fresh vegetables and fruits from Iran and Afghanistan will also fuel food inflation in the coming weeks.

The weekly inflation hit a record 48.35pc year-on-year in early May 2023, but then decelerated as low as 24.4pc in late August 2023 before surging past 40pc during the week ending November 16 2023.

The items whose prices saw the increase week-on-week included tomatoes (65.84pc), potatoes (5.61pc), onions (3.78pc), bananas (3.29pc), LPG (2.44pc), cigarettes (1.67pc), pulse moong (1.53pc), garlic (1.29pc), milk fresh (0.95pc), eggs (0.83pc), georgette (0.28pc) and shirting (0.17pc).

The items whose prices decreased the most over the previous week included petrol (3.76pc), diesel (0.84pc), rice basmati broken and pulse masoor (0.08pc) each and chicken (0.05pc).

However, on an annual basis, the items whose prices increased the most included gas charges for Q1 (570pc), tomatoes (191pc), onions (122.66pc), chillies powder (54.81pc), garlic (40.55pc), shirting (30.75pc), salt powder (29.49pc), gents sandal (25.01pc), pulse gram (22.67pc), pulse mash (22.60pc), beef (22.12pc) and electricity charges for Q1 (21.46pc).

In contrast, the prices of wheat flour dropped 32.90pc, followed by chicken (20.60pc), cooking oil 5 Litre (16.17pc), vegetable ghee 2.5 kg (13.39pc), vegetable ghee 1 kg (12.42pc), bananas (11.69pc), mustard oil (8.24pc), tea Lipton (2.52pc), and petrol (1.38pc).

The SPI stood at 316.88 compared to 313.93 the preceding week and 256 a year ago.

The 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.

Data showed that the prices of 25 items increased, those of 5 items decreased and those of 21 items remained stable compared to the previous week.

Published in Dawn, June 22nd, 2024

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