Pakistan’s inflation rate increases to 9.04 percent

ISLAMABAD: The inflation rate again jumped above 9 percent in September due to a double-digit spike in prices of food items as the government struggled to ensure smooth supplies.

According to the Pakistan Bureau of Statistics (PBS) report, the average rate of increase in prices of goods and services stood at 9.04% in September over the same month in 2019. On a month-on-month basis, the index jumped 1.5% in September over August, the PBS report said.

The PBS reported the latest inflation figures days after the Monetary Policy Committee (MPC) kept the policy rate unchanged at 7%. The inflation rate is driven by an increase in the prices of both perishable and non-perishable food items.

The 9% inflation in September was in line with the federal government’s expectations that had predicted that inflation would remain in the range of 7.8% to 9% in September. In August, the reading was 8.2%.

Core inflation, measured by excluding food and energy goods from the commodities’ basket, slightly decelerated to 5.5% in September over August reading of 5.6% in urban areas, according to the PBS. In rural areas, the core inflation increased from 7.6% to 7.8% in September.

Food inflation in urban areas jumped from 11.3% to 12.4% in September on a year-on-year basis. In rural areas, it increased from 13.5% to 15.8%, reported the data collecting agency.

The average increase in prices of perishable food items group was calculated at 15.1% last month over a year ago, according to PBS. Prices of food and the non-alcoholic group increased 14.7% from a year ago. Non-perishable food group prices also rose by about 14.7%, according to PBS.

PBS reported that wheat prices increased 42.1% in September from the same month a year ago in urban areas and over 45% in rural areas. Prices of wheat flour rose 20.2% in cities and nearly 27% in rural areas.

After exporting wheat, the PTI government is now in the process of importing 1.5 million tons of wheat. The ECC on Friday approved the import of 180,000 tons of wheat from Russia at a cost of $279 per ton.

Sugar prices increased 25.4% in September in both cities and villages over a year ago, according to the national data collecting agency.