October inflation soars to 26.6pc
Inflation measured by the Consumer Price Index (CPI) shot up to 26.56 per cent year-on-year in October, over three percentage points higher than last month’s 23.18pc and significantly higher than the 9.2pc in the same month last year, data released by the Pakistan Bureau of Statistics (PBS) showed on Tuesday.
Official data showed that inflation in October rose 4.71pc month-on-month.
Pakistan continues to be in the grips of high food and transport prices, which pushed headline inflation in August to a 49-year-high of 27.26pc.
Inflation in October was driven by a double-digit increase in all sub-indices except communications.
Index-wise increase in inflation YoY:
- Perishable food items: 70.47pc
- Transport: 53.43pc
- Alcoholic beverages and tobacco: 34.63pc
- Non-perishable food items: 30.58pc
- Restaurants and hotels: 30.38pc
- Furnishing and household equipment maintenance: 27.61pc
- Recreation and culture: 23.65pc
- Miscellaneous goods and services: 22.35pc
- Clothing and footwear: 18.28pc
- Health: 16.23pc
- Housing and utilities: 11.92pc
- Education: 10.88pc
- Communication: 1.58pc
According to the PBS data, urban and rural inflation increased 24.57pc and 29.53pc YoY, respectively.
The figures contradict the finance ministry’s claim in the Monthly Economic Update and Outlook for October that inflation was likely to reduce as local average prices of basic goods had declined.
“The inflationary risks have partially been alleviated due to timely decisions to import perishable items by waiving off the customs duties. Administrative measures are also being taken to control price speculation to ease out inflation … Moreover, the declining international commodity prices are expected to offset the inflation spikes that emerged due to domestic supply shocks.
“It can be expected that YoY CPI inflation in the month of October will maintain its declining tendency observed in September. It is expected that CPI inflation will remain in the range of 21-22.5pc,” the ministry had predicted.
This year’s floods have devastated the agriculture sector with sugarcane and rice crops among the most affected. Besides, around one million cows and sheep are estimated to have perished, according to a report released last week.
The government had exempted sales tax and withholding tax on the import of tomatoes and onions for a period of four months in September.