ISLAMABAD, Sept 14: The core inflation — non-food non-energy — exhibited the declining trend as it stood at 5.3 per cent in August 2007 as against 6.6 per cent in the corresponding month last year.

Tight monetary policy pursued by the State Bank of Pakistan was mainly responsible for this decline in the core inflation, according to an official report of the ministry of finance issued here on Friday.

The core inflation during the first two months (July-August) of the current fiscal stood at 5.3 per cent as against 6.8 per cent recorded during the same months last year.

It is the only area where the government has so far been successful in controlling the inflationary pressure.

According to the report, the overall consumer price index (CPI) based inflation registered a significant decline to 6.4 per cent in August 2007 as against 8.9 per cent over corresponding month last year.

This reduction was attributed to a decrease in food and non-food inflation, which eased from 11.1pc and 7.4pc in August 2006 to 8.6pc and 4.9pc in August 2007, respectively.