Drop in tomato, onion prices eases SPI inflation

KARACHI: After rising for three consecutive weeks, decline in tomato and onion prices provided slight relief to middle and lower income consumers who remain burdened with high food and fuel prices for the last couple of years.

Pakistan Bureau of Statistics (PBS) data issued on Friday showed that sensitive price indicator (SPI) for the combined group inched down 0.68 percent week-on-week and up 16.44 percent year-on-year. The change was mainly attributed to decline in prices of tomatoes (34.14 percent), onions (8.46 percent), potatoes (3.73 percent), garlic (3.68 percent), bananas (2.61 percent), mustard oil (0.34 percent), wheat flour (0.33 percent), sugar (0.25 percent), LPG (1.25 percent), and firewood (0.80 percent). The joint impact of these commodities brought SPI down 0.77 percent for the combined group.

Analyst Fahad Rauf of Ismail Iqbal Securities in his note said SPI “eased modestly” mainly due to decrease in food prices.

Tomato prices dropped Rs52.59/kg to stand at Rs101.46/kg on average, down from Rs154.05 last week when supply chain issues and Ramazan were cited as the major reasons behind the price hike.

PBS data attributes different weightages to the commodities in the SPI basket. Commodities with the highest weights for the lowest quintile include milk (17.5449 points), electricity (8.3627 points), wheat flour (6.1372 points), sugar (5.1148 points), firewood (5.0183 points), long cloth (4.2221 points), and vegetable ghee (3.2833 points).

Of these commodities, only the price of milk went up by a few paisa, whereas the prices of wheat flour, sugar and firewood declined, and prices of electricity, long cloth, and vegetable ghee remained the same.

Average price of 1kg pouch of vegetable ghee stood the same at Rs474.23 during the week; however it was up Rs171.11 from last year. The price of vegetable ghee has shot up by Rs323.91 from Rs150.32 during the week ended August 16, 2018. Similarly, price of a 20kg wheat flour bag has jumped by Rs396.54 to Rs1,168.89 since August 16, 2018 when it was available for Rs771.46.

PBS computes SPI inflation on a weekly basis to gauge the price movement of essential commodities at a shorter interval of time so as to review the price situation in the country. It comprises 51 essential items and the prices are collected from 50 markets in 17 cities of the country.

During the week, out of 51 items, prices of 17 items increased, 10 items decreased, whereas prices of 24 items remained unchanged.

For the groups spending up to Rs17,732; Rs17,733-22,888; Rs22,889-29,517; Rs29,518-44,175; and above Rs44,175; WoW SPI decreased 1.01, 0.95, 0.80, 0.73, and 0.56 percent, respectively.

SPI was recorded at 173.27 points against 174.45 points registered previously.

On year-on-year basis, major rise was recorded in the prices of tomatoes (85.04 percent), LPG (79.12 percent), garlic (77 percent), onions (67.68 percent), cooking oil 5 litre (58.14 percent), vegetable ghee 2.5kg and 1kg (57.31 percent and 56.45 percent), mustard oil (56.76 percent), pulse masoor (42.51 percent), washing soap (38.83 percent), petrol (35.25 percent), and diesel (27 percent).