Weekly inflation up 1.42pc on surging food prices

Andaleeb Rizvi
Saturday, May 21, 2022

KARACHI: Weekly inflation accelerated to 1.42 percent week-on-week and 16.54 percent year-on-year during the seven-day period ended May 19, as it got a boost from high food prices.

Pakistan Bureau of Statistics (PBS) data issued on Friday showed that 33 of the 51 items in SPI basket registered an increase. Hefty spike in prices of food and essential commodities pushed weekly inflation up to a five-week high. Last high of 1.53 percent in the sensitive price indicator (SPI) was recorded during the week ended April 7, 2022.

Major uptick was recorded in prices of chicken (9.03 percent), pulse masoor (6.30 percent), eggs (4.24 percent), wheat flour (3.99 percent), pulse gram (3.86 percent), rice basmati broken (3.11 percent), mustard oil (2.99 percent), rice irri-6/9 (2.67 percent), pulse mash (1.86 percent), curd (1.68 percent), onions (1.38 percent), milk fresh (1.18 percent), energy saver (4.37 percent) and long cloth 57 inches (1.97 percent).

The joint impact of these commodities was 1.14 percent in overall SPI for the combined group. Decrease was observed in the prices of only four commodities; those were bananas (2.97 percent), tomatoes (0.20 percent), potatoes (0.11 percent) and gur (0.07 percent).

Analyst Fahad Rauf of Ismail Iqbal Securities said SPI increased “mainly due to sharp increase in food inflation”, with chicken and wheat prices continuing to rise up.

“Going forward, the inflation trajectory would mainly depend upon government’s decision on electricity and petroleum subsidies, measures in annual budget, and international commodity prices. Based on current numbers, we expect CPI (consumer price index) to come in at 14.3 percent in May 2022,” he added.

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 33 items increased, four items decreased, whereas prices of 14 items remained unchanged.

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). Prices of all these commodities sped up except electricity.

Wheat flour, an essential in all households is now priced at Rs1,425.03/20kg bag compared to Rs1,370.41 last week and Rs1,145.84 during the same period last year.

Similarly, average price of vegetable ghee increased to Rs482.22/1kg during the week, compared to Rs480.22 last week and Rs303.12 in the same week last year. On August 16, 2018, wheat flour was available for Rs771.45/20kg while vegetable ghee was being sold for Rs150.32/1kg pouch.

SPI was recorded at 175.08 points against 172.63 points registered previously.

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 shot up 1.46, 1.58, 1.54, 1.52, and 1.30 percent, respectively, with YoY SPI up 14.84, 15.29, 16.27, 16.89, and 17.40, respectively.

On year-on-year basis, major rise was recorded in the prices of tomatoes (171.18 percent), onions (147.18 percent), LPG (99.65 percent), garlic (81.51 percent), pulse masoor (61.69 percent), mustard oil (61.05 percent), cooking oil 5 litre (60.43 percent), vegetable ghee 2.5kg (59.8 percent), vegetable ghee 1kg (59.09 percent), washing soap (39.96 percent), petrol (37.42 percent), and diesel (29.63 percent).