ISLAMABAD, June 12: Inflation measured by the Consumer Price Index (CPI) rose by 7.95 per cent during 11 months (July-May) of the current fiscal year, over the corresponding period last year owing to an increase in food items, transportation and oil prices.

This surge in inflation means that the average price of 374 items recorded a 7.95 per cent increase during the period under review, over the same period last year in 35 urban cities, thus putting more pressures on the middle, lower middle and poor segment of society.

During this period, education fees, books price, etc., recorded an increase of 7.16 percent; prices of basic medicines, which did not include essential drugs, rose 3.94 per cent; and transport and communications -- petrol, diesel, kerosene and transport fares -- up 13 per cent.

Official figures released by the Federal Bureau of Statistics (FBS) here on Monday showed the highest inflation recorded so far was 8.99 per cent in the first month (July 2005) of the current fiscal year, over the previous year, which then steadily came down to 7.12 per cent in May 2006.

However, in May 2006, inflation increased by 0.45 per cent as against April 2006. The FBS data showed that inflationary pressures still existed in the economy, although a declining trend was visible. The government has projected to keep inflation within the targeted rate of eight per cent by the end of June 2006.

The government inflation rate for the period under review did not cover more than 70 per cent rural consumers who have even no access to government subsidized foods and other facilities like gas as fuel, etc. This means that actual inflation keeping in view the size and coverage of the government measurement has already crossed double digit.

An official on condition of anonymity told Dawn that it was possible that negative influence of the factors causing inflation could have been limited by strengthening the local currency and fixed exchange rate.

He said high inflation was due to a fast growth in monetary assets as compared to real growth in the economy. He also expressed concern over low savings and partially held wide spread in deposit and mark-up rates for this.

Main commodities whose prices increased in May were: pulse gram (17.38 per cent); besan (12.42 per cent); mash (9.40 per cent); gur (7.94 per cent); moong (5.73 per cent); fresh fruits (4.20 per cent); masoor (3.41 per cent); milk fresh (2.99 per cent); betel leaves and nuts (2.35 per cent); meat (2.23 per cent); milk products (2.06 per cent); beverages (2.01 per cent); gram whole (1.85 per cent); and sweet meat and nimco (1.77 per cent).

The price of cotton cloth increased by 1.05pc, LPG 2.27pc, firewood by 1.10pc, electric iron, fans, washing machine by 2.20pc, furniture by 1.53pc and household servant up by 1.10pc during the month under review. Air fare increased by 26.95pc, train fare by 5.24pc, jewellery by 14.79pc and hair cut and beauty parlour charges by 1.09pc.

Prices of tomatoes decreased by 27.76 per cent, onions 22.57 per cent, vegetables 5.75 per cent, chicken farm 4.50 per cent, wheat 2.88 per cent, wheat flour 2.54 per cent, eggs 1.22 per cent, potatoes 1.19 per cent and sugar by 0.84 per cent during May 2006.