SPI inflation up 0.2pc WoW, 12.66pc YoY

October 16, 2021

KARACHI: Weekly inflation went up 0.2 percent week-on-week and 12.66 percent year-on-year during the seven-day period ended October 14, as increase in prices of edibles and LPG continued to take a...

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KARACHI: Weekly inflation went up 0.2 percent week-on-week and 12.66 percent year-on-year during the seven-day period ended October 14, as increase in prices of edibles and LPG continued to take a toll on the indicator.

Inflation report released by the Pakistan Bureau of Statistics (PBS) attributed the WoW change to increase in prices of tomatoes (19.21 percent), mustard oil (3.12 percent), prepared tea (2.12 percent), LPG (2.07 percent), washing soap (1.98 percent), cooked daal (1.55 percent), tea Lipton (1.48 percent) and cooked beef (1.32 percent). The joint impact of these commodities was 0.34 percent into the overall SPI for the combined group.

The price of 11.67kg LPG cylinder increased by Rs43.96 to Rs2,167.31 during the week, up from Rs2,123.35 last week. The increase was Rs850.56 from last year, when LPG was available for Rs1,316.75/cylinder.

Weekly sensitive price indicator (SPI) inflation has been on an upward trajectory over the past two weeks.

Analyst Fahad Rauf of Ismail Iqbal Securities in his note said that SPI was considerably muted this week due to the decline in sugar prices.

“We expect October 2021 CPI (consumer price index) to remain in the range of 8-8.5 percent vs 9 percent in September 2021,” the note said.

Key drivers on month-on-month basis would be house rent revision, and rise in petroleum prices. However, food inflation would likely remain under control.

Refined sugar shed Rs6.72 and was available for Rs107.05/kg this week, down from Rs107.05/kg last week.

Last week, SPI inflation jumped 1.21 percent WoW and 12.94 percent YoY on account of raised fuel rates triggered by hike in international prices and exchange rate variation.

Petrol prices remained unchanged at Rs128.23/litre during the week ended October 14, but were up by Rs23.31 from Rs104.92 during the same week last year.

SPI for the groups spending up to Rs17,731; Rs17,732-22,888; Rs22,889-29,517; Rs29,518-44,175; and above Rs44,175 showed an increase of 0.15, 0.16, 0.17, 0.16, and 0.24, respectively. The highest impact was suffered by the first quintile, which faced rise of 14.12 percent in YoY SPI. For the week under review, SPI was recorded at 159.26 points against 158.94 points registered previously.

SPI is computed on weekly basis to assess the price movements of essential commodities at shorter interval of time so as to review the price situation in the country. It comprises of 51 essential items and the prices are collected from 50 markets in 17 cities of the country.

During the week, prices of 22 items increased, 10 decreased, while prices of 19 items remained unchanged.

PBS data attributes different weightages to the commodities in the SPI basket. The commodities with the highest weightages for the lowest quintile include milk (17.5449 points), electricity (8.3627 points), and wheat flour (6.1372 points). Milk prices remained unchanged at Rs112.02/litre; however, wheat flour declined by Rs11.05 WoW to stand at Rs1,209.46/20kg bag, whereas electricity tariff has increased multiple times during the year.

he YoY trend depicted an increase of 12.66 percent, with prices of LPG up 64.60 percent, electricity for Q1 up 61.11 percent, mustard oil 43.82 percent, vegetable ghee 1kg 41.55 percent, vegetable ghee 2.5kg 39.94 percent, cooking oil 5 litre 38.70 percent, chilli powder 33.43 percent, gents sandal 33.37 percent, chicken 30.08 percent, washing soap 26.61 percent, garlic 22.78 percent, petrol 22.22 percent, and diesel 17.13 percent.

Power consumers continued to pay Rs6.38/unit this week; however, government is mulling to raise the tariff again to chase the International Monetary Fund (IMF) conditions for the extended fund facility.



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