ISLAMABAD - Inflation was recorded at 2.91 percent during July over a year ago, well below the official’s target, mainly due to decline in food prices.

The inflation measured through Consumer Price Index (CPI), which tracks prices of around 480 commodities every month, increased by 2.91 percent during July 2017 as compared to the same month of the last year, according to the latest data of Pakistan Bureau of Statistics.

The government had restricted the inflation rate at 4.16 percent during previous fiscal year (FY2017), well below the target of 6 percent. The inflation rate is under control due to the stability in oil prices in international market.

The State Bank of Pakistan (SBP) in its last monetary had decided to maintain the policy rate at 5.75 as the inflation rate has contained. The SBP is projecting average CPI inflation in the range of 4.5 – 5.5 percent for FY18. This projection is explained by lower than anticipated increase in international oil prices, recent behavior of CPI inflation in June 2017, stable administered prices and lower inflationary expectations.

According to Pakistan Bureau of Statistics, the Sensitive Price Indicator (SPI), which gauges rates of kitchen items on weekly basis, decreased by 0.4 percent during July 2017 as against same month of the previous year. Similarly, the wholesale price index (WPI) based inflation increased by 0.66 percent in the period under review.

The break-up of inflation of 2.91 percent showed that food and non-alcoholic beverages prices increased by 0.71 percent. Similarly, health and education charges went up by 13.35 percent and 11.36 percent, respectively. Similarly, prices of utilities (housing, water, electricity, gas and fuel) increased by 5.29 percent in last the month.

Meanwhile, the prices of alcoholic beverages and tobacco went down by 15.93 percent. Price of clothing and footwear increased by 3.89 percent and furnishing and household equipment maintenance charges by 2.72 percent. Recreational charges and those related to culture went up by 0.21 percent in the period under review, while amounts charged by restaurants and hotels by 5.32 percent in July as compared to the same month last year.

In food commodities, prices of onions increased by 9.99 percent, fresh vegetables 9.31 percent, chicken 4.34pc, potatoes 4.18pc and eggs price surged by 3.75 percent. Likewise, in non-food items, house rent enhanced by 1.49 percent, construction input items by 1.17 percent and construction wage rate up by 0.95 percent during July 2017.

According to the PBS figures, price of fresh fruits decreased by 6.66 percent, cigarettes 5.61pc, pulse gram 2.82 percent and sugar price down by 1.98pc.