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Inflation rises to 4pc

Inflation rises to 4pc

ISLAMABAD: Annual inflation rose to four per cent in February 2016 from 3.3pc in the preceding month, the Pakistan Bureau of Statistics said showed on Tuesday.

Average inflation for July-February 2015-16 stood at 2.48pc.

The Consumer Price Index (CPI), used to measure prices of 481 commodities, has been witnessing an upward trend since November 2015.

Prices of non-perishable and perishable products increased by 2.8pc and 2.42pc month-on-month in February 2016. Additional upward pressure came from the hike in prices of clothes and footwear, housing, health, water, electricity, gas and fuel, transport and furnishing equipment.

One of the reasons for the surge in inflation was the introduction of Rs40 billion new taxes on import of processed food and other items.

Core inflation, measured by excluding volatile food and energy prices, was recorded at 4.5pc during the month under review, slightly up from 4.3pc in the previous month.

Falling inflation has also encouraged the State Bank to maintain its key interest rate at 6pc (42-year low).

Core inflation has remained subdued since November 2015 because of a tighter monetary policy and reduction in fuel prices.

In February 2016, food inflation stood at 3.7pc.

Food items, whose prices increased included chicken (19.58pc), potatoes (11.84pc), onion (7.55pc), tomatoes (7.06pc), fish (3.08pc), besan (2.84pc), wheat product (1.54pc), eggs (1.54pc), pulse gram (1.50pc) and pulse moong (1.06pc).

Non-food inflation stood at 4.2pc in February 2016. Price of water supply rose by 5.06pc, personal equipment 2.33pc, medical tests 2.26pc, household servants 2.12pc, doctor (MBBS) clinic fee 1.39pc, stationery 1.39pc and drugs and medicines 1.38pc.

Average inflation measured through the Sensitive Price Index (SPI) was up by 1.02pc in July-February 2015-16, while Wholesale Price Index (WPI) was still negative 1.70pc.

Lower WPI reflects less demand for domestic commodities, mainly because of low purchasing power.

Courtesy : Dawn News



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