ISLAMABAD: Prices for seasonal essentials continued to rise as inflation registered 11 percent in October 2019 compared to the previous year, the Pakistan Statistics Office (PBS) reported on Wednesday.
Inflation, measured through the Consumer Price Index (CPI), increased 1.8{7be40b84a6a43fc4fae13304fce9a2695859798abfc41afd127b9f8b21c5f9c5} during the previous month after the PBS revised its calculation methodology by establishing the new 2015-16 base year instead of the fiscal year 2007-08 previous.
The change in the base year means that the price levels of the economy in the 2016 fiscal year will now be the basis against which all existing prices for the CPI will be calculated.
According to the new base year, October inflation was 11.04 percent, compared to 11.4 percent in the previous month.
As of the old base year of fiscal year 2008 that was used until three months ago, the key inflation rate reaches 11.08pc for October, showing an increase of 1pc during the month of September.
According to the new base year, the lowest CPI was registered in July at 8.4pc.
The data shows that the urban CPI covers 35 cities and 356 consumer items, while the rural CPI tracks 27 rural centers and 244 items. The first grew 10.9 percent year-on-year in October, while the second rose 11.3 percent.
The International Monetary Fund has estimated that Pakistan's inflation may increase up to 13pc, but the government's estimate is around 11pc, which has already been crossed in the outgoing month.
The underlying inflation rate in urban areas was 7.8 percent in October according to the new methodology, since it dropped from 8.4 percent. The core inflation rate in rural areas was 8.6 percent in October, while it was 8.8 percent in the previous month. The central bank determines the key policy rate (which is currently at 13.25pc) based on the underlying inflation rate.
A more detailed analysis shows that food inflation in urban areas increased by 13.7 percent in October annually and 1.4 percent per month. In rural areas, food inflation increased 14.6 percent annually and 2.6 percent monthly.
Similarly, non-food inflation in urban centers was recorded at 9.4 percent year-on-year, while it was 8.7 percent in rural areas.
In urban areas, foods that increased their price levels included: tomatoes (34.97pc), eggs (19.74pc), fresh vegetables (17.69pc), potatoes (10.08pc), onions (4.98pc), beans (2.53 pcs ), fish (2pc), dried fruits (1.86pc), milk powder (1.79pc), kiss (1.28pc), wheat (1.22pc), meat (1.17pc), pulse masoor (1.04pc) and Gur (1 PC)
The articles that decreased in urban areas were sugar (1.37pc), chicken (18.17pc) and fresh fruits (1.39pc).
In rural areas, items that witnessed an increase in inflation included fresh vegetables (36.73pc), tomatoes (27.07pc), eggs (15.76pc), potatoes (9.62pc), onions (3.63pc), pulse puree ( 3.13pc), fish (2.69pc), beans (2.6pc), gur (2.21pc), gram of pulse (2.17pc), nuts (1.55pc), milk powder (1.35pc), wheat (1.35pc) , vegetable ghee (1.19 pc), tea (1.15pc), wheat flour (1.13pc) and rice (1.03pc). In rural areas, chicken prices fell 14.14pc, sugar 1.47pc and fresh fruits 1.06pc.
Prime Minister's meeting on essential items
Disturbed by seasonal fluctuations in the prices of essential goods, Prime Minister Imran Khan held a detailed meeting with his economic team on Wednesday to devise ways to control their prices, particularly those of flour, ghee and sugar, and took Some important decisions.
Mr. Khan requested the establishment of a "Special Cell" in the Ministry of National Food Security with immediate effect. The cell will make timely decisions about the evaluation of the demand and the supply of essential items.
However, on the issue of the continuous increase in the price of flour, the main secretaries informed the prime minister that there was no complaint about the shortage of wheat in the country after the supply of basic products from the storage houses of Pasco.
Apparently, the prime minister was not happy with the explanations of the main secretaries and asked to take all measures to control the prices of essential food items. He asked to control the smuggling of wheat, flour and fine flour from the country.
He said more measures should be taken to control hoarding and speculation. The main directed use of new technologies to reduce the price difference in the wholesale and retail markets.
The prime minister called for a reduction in ghee prices after the postponement of the axle load policy. It was also decided that the government would provide a tehsil-level place for growers to sell their products directly without any fee or expense.
Mr. Khan sought a weekly report on essential items at the district and national levels to verify the actual prices of the products. It was also decided to use the chain of utility stores to provide essential items to consumers.
The chief commissioner of Islamabad informed the meeting about the launch of "Durust Daam", a mobile application, in the capital to control the price increase and the difference in market rates. It was decided to introduce the same system in Abbottabad, Peshawar, Mardan and Dera Ismail Khan, Rawalpindi, Multan and Lahore with immediate effect.
Posted in Dawn, November 7, 2019
Source: https://www.dawn.com/news/1515390/inflation-clocks-in-at-11pc-in-october