KARACHI: Government decision to increase petroleum rates took a toll on the poorest of the poor in the country as weekly inflation surged to 33-week high at 1.38 percent week-on-week and 14.48...
KARACHI: Government decision to increase petroleum rates took a toll on the poorest of the poor in the country as weekly inflation surged to 33-week high at 1.38 percent week-on-week and 14.48 percent year-on-year during the seven-day period ended October 21.
Inflation report released by the Pakistan Bureau of Statistics (PBS) on Friday pinned the WoW change on increase in prices of tomatoes (41.63 percent), diesel (10.06 percent), petrol (8.19 percent), LPG (7.11 percent), mustard oil (2.23 percent), vegetable ghee 1kg (1.91 percent), bread plain (1.84 percent), garlic (1.82 percent), washing soap (1.72 percent), potatoes (1.57 percent), cooking oil 5 litre (1.5 percent), bananas (1.4 percent), georgette (1.32 percent), eggs (1.31 percent) and vegetable ghee 2.5kg (1.25 percent). The joint impact of these commodities was 1.36 percent in the overall sensitive price indicator (SPI) for the combined income group.
Analyst Fahad Rauf of Ismail Iqbal Securities in his note said that major contribution to SPI came from petrol, tomatoes and LPG. “We estimate October 2021 CPI (consumer price index) at 8.5 percent vs 9 percent in September 2021. Key contributors to MoM inflation would be petroleum prices and house rent revision,” the note added.
Government faced widespread condemnation on October 16, when it decided to increase the price of hi-speed diesel by Rs12.44 to Rs135.41/litre and petrol by Rs10.49 to Rs138.73/litre. Last year during the week ended October 22, the price of HSD was Rs105.04/litre and petrol was Rs104.92/litre.
Similarly, the price of 11.67kg LPG cylinder increased by Rs154.15 to Rs2,321.46 during the week, up from Rs2,167.31 last week. The increase was Rs995.09 from the same period last year, when LPG was available for Rs1,326.37/cylinder.
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 29 items increased, 7 decreased, while prices of 15 items remained unchanged.
Weekly sensitive price indicator (SPI) inflation has been on an upward trajectory over the past three weeks.
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 0.96, 1.07, 1.11, 1.23, and 1.58, respectively. The highest impact of WoW change was faced by the fifth quintile, while the worst YoY impact of 15.72 percent was suffered by the group having the lowest spending capacity of up to Rs17,732.
For the week under review, SPI was recorded at 161.46 points against 159.26 points registered previously.
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).
Fresh milk price inched up to Rs112.48 from Rs112.02/litre; however, wheat flour declined by Rs2.19 WoW to stand at Rs1,196.22/20kg bag, whereas electricity tariff has increased multiple times during the year.
The YoY trend depicted an increase of 14.48 percent, with prices of LPG up 75.02 percent, electricity for Q1 up 61.11 percent, mustard oil 46.49 percent, vegetable ghee 1kg 44.25 percent, cooking oil 5 litre 40.78 percent, chilli powder 33.43 percent, and petrol 32.22 percent.
vegetable ghee 2.5kg 39.94 percent, , gents sandal 33.37 percent, chicken 30.08 percent, washing soap 26.61 percent, garlic 22.78 percent, , and diesel 17.13 percent. A major decrease was observed in the YoY prices of pulse moong 32.05 percent, tomatoes 30.44 percent, onions 28.30 percent, potatoes 21.87 percent, and pulse mash 1.59 percent.
Power consumers continued to pay Rs6.38/unit this week, but the government has been mulling to raise the tariff to chase the $1 billion tranche of the International Monetary Fund’s extended fund facility.