ISLAMABAD - Inflation rate surged by 11.04 percent in October on annual basis due to increase in prices of basic food commodities. Inflation, measured through the Consumer Price Index (CPI), edged up by 1.82 percent in October over the previous month (September), the Pakistan Bureau of Statistics (PBS) reported on Wednesday.
The PBS has released two figures of CPI (Consumer price index) based inflation as one figure with old methodology and second with rebasing exercise. On both accounts, the CPI based inflation has shown rising trends. Inflation with new base year (2015-16) has increased by 11.04 percent. Meanwhile, on old methodology (base 2007-08), the inflation has gone to high 11.08 percent in October 2019 over the corresponding period of last year.
Inflation rate is continuously increasing mainly due to the economic policies of the incumbent government including rupee devaluation and increase in energy costs. The International Monetary Fund (IMF) had estimated that Pakistan’s inflation may surge to 13 percent. The Asian Development Bank (ADB) had already warned that inflation rate would further accelerate to 12 percent in ongoing fiscal year (FY2020) because of a planned hike in domestic utility prices; taxes introduced in budget and lagged impact of currency depreciation. However, the government’s estimate is around 11 percent, which is already been crossed in the outgoing month.
According to the PBS, inflation was recorded at 10.32 percent during first four months (July to October) of the current fiscal year. Meanwhile, the Sensitive Price Indicator (SPI), which gauges rates of kitchen items on weekly basis, increased by 12.7 percent. Similarly, the wholesale price index (WPI) based inflation enhanced by 14.1 percent in the period under review.
Core inflation measured by non-food non-energy Rural CPI (Core NFNE) increased by 8.6 percent on annual basis in October 2019 as compared to an increase of 8.8 percent in the previous month and 6.7 percent in October 2018. The break-up of inflation of 11.04 percent in October 2019 showed that food and non-alcoholic beverages prices increased by 15.03 percent. Similarly, health and education charges went up by 12.15 percent and 6.02 percent, respectively. Similarly, prices of utilities (housing, water, electricity, gas and fuel) increased by 7.18 percent in last the month. Meanwhile, the prices of alcoholic beverages and tobacco went up by around 20.34 percent. Price of clothing and footwear increased by 9.32 percent and furnishing and household equipment maintenance charges 11.28 percent. Recreational charges and those related to culture went up by 7.44 percent in the period under review, while amounts charged by restaurants and hotels by 6.01 percent in October 2019 as compared to the same month last year.
