YoY Inflation Remains High, But Sensitive Price Indicator Shows a Slight Decrease:
According to the data released by the Pakistan Bureau of Statistics (PSB), weekly inflation for the week ended May 25, 2023, stood at 45.49 percent on a year-on-year (YoY) basis. While the inflation rate has come down slightly compared to the previous week, the overall trend remains high. However, there was a decrease of 0.42 percent in the Sensitive Price Indicator (SPI) based inflation for the week ended May 11, 2023, primarily driven by lower prices of both food and non-food items.
Factors Contributing to the YoY Inflation Trend:
The year-on-year trend in inflation is primarily influenced by the price fluctuations of various essential commodities. Notable increases were observed in the prices of items such as Cigarettes, Tea Lipton, Wheat Flour, Gas Charges for Q1, Bananas, Potatoes, Rice Basmati Broken, Rice Irri-6/9, Petrol, Diesel, Eggs, Pulse Moong, Bread, and Pulse Mash. On the other hand, there was a decrease in the prices of Tomatoes and Onions. These price fluctuations contribute to the overall inflationary pressure experienced by consumers.
Weekly Price Movements and the Stability of Goods:
On a week-on-week basis, there were fluctuations in the prices of various food and non-food items. Prices decreased for items like Chicken, Wheat Flour, Eggs, Garlic, Tomatoes, Onions, Bananas, Pulse Moong, Pulse Masoor, Cooking Oil 5 Litre, and non-food item LPG. However, certain items experienced price increases, including Energy Saver, Rice Basmati Broken, Cooked Beef, Mutton, Fresh Milk, Shirting, and Beef. Out of the 51 items monitored, 18 items witnessed price increases, 16 items had price decreases, and 17 items remained stable during the week.
Despite the slight decrease in SPI-based inflation, the persistent high year-on-year inflation poses challenges for consumers, especially in terms of the cost of living and purchasing power. Monitoring price movements and understanding the factors driving inflationary trends are essential for policymakers and individuals alike to make informed decisions and navigate through the evolving economic landscape.