ISLAMABAD - Inflation in the country has skyrocketed to 31.5 percent in February this year mainly due to the currency depreciation and recent rise in energy prices.
Inflation measured through the consumer price indicator (CPI) has enhanced to 31.5 percent in February this year — reportedly higher since 1974. On month on month basis, it has increased to 4.3 percent in February 2023 as compared to an increase of 2.9 percent in the previous month (January), according to the latest data of Pakistan Bureau of Statistics (PBS).
Inflation remained far higher than the projection of the ministry of finance. “It is expected that inflation will remain around 28 to 30 percent in coming months. The key reasons are uncertain political and economic environment, pass through of currency depreciation, recent rise in energy prices and increase in administered prices,” the ministry has stated in its monthly report. The economic experts believed that inflation would further fuel in the country following the massive currency depreciation, increase in electricity and gas prices and imposition of mini budget worth of Rs170 billion. The government had taken all these measures to revive the International Monetary Fund (IMF) loan programme, which is yet to be revived. The State Bank of Pakistan on the direction of the IMF is all set to increase the interest, which is currently 17 percent, to control the inflation rate.
According to the PBS data, the CPI inflation Urban increased by 28.8 percent on a year-on-year basis in February 2023. Meanwhile, the CPI inflation for Rural has enhanced by 35.6 percent. Meanwhile, it has enhanced by 26.19 percent in eight months (July to February) of the current fiscal year. The Sensitive Price Index (SPI), which gauges rates of kitchen items on a weekly basis, increased by 29.21 percent. On a monthly basis, Wholesale Price Index (WPI) inflation on YoY basis increased by 33.68 percent in February 2022.
The break-up of inflation of 31.5 percent showed that food and non-alcoholic beverages prices increased by 45.07 percent last month. Similarly, health and education charges went up by 18.78 percent and 10.79 percent, respectively. Similarly, prices of utilities (housing, water, electricity, gas and fuel) increased by 13.58 percent in the last month. Meanwhile, the prices of alcoholic beverages and tobacco went up by around 49.2 percent. Prices of clothing and footwear increased by 16.98 percent and furnishing and household equipment maintenance charges 34.04 percent. Recreational charges and those related to culture went up by 48.05 percent in the period under review, while amounts charged by restaurants and hotels by 34.54 percent in February 2023 as compared to the same month last year.
In urban areas, the food items which saw their prices increased during February 2023 included chicken (19.89 percent), cooking oil (17.21 percent), vegetable ghee (16.59 percent), cigarettes (15.64 percent), fresh fruits (15.13 percent), fresh vegetables (13.97 percent), gram whole (11.35 percent), pulse gram (11.03 percent), besan (10.98 percent), mustard oil (10.4 percent), pulse mash (10.35 percent), rice (9.54 percent), beans (8.32 percent), pulse moong (6.35 percent), pulse masoor (5.89 percent), potatoes (4.13 percent), fish (2.64 percent), milk fresh (2.25 percent), meat (1.93 percent) and sugar (0.11 percent). In non-food commodities, prices of following commodities enhanced included gas charges (62.82 percent), liquified hydrocarbons (35.55 percent), motor fuel (16.53 percent), communication apparatus (12.2 percent), motor vehicles (10.32 percent), motor vehicle accessories (7.70 percent), marriage hall charges (5.61 percent) and construction input items (5.51 percent).