The weekly inflation has finally eased a bit (0.16%) but still remained elevated at 45.72 percent for the week ending on 18th May. The Sensitive Price Index (SPI) was on a constant rise due to a weaker rupee, expensive petrol and electricity, and a higher rate of sales tax. The past two weeks witnessed a high weekly inflation rate which stayed above 48 percent due to high prices of transport, vegetables, wheat flour, meat, pulses, and sugar.
The Drop in Weekly Inflation
The current weekly inflation rate dropped a bit, just three days before the data collection, as the finance minister announced a 12-rupee cut in the price of petroleum products. He also urged the transporters to pass relief to the masses in terms of reduced fares and decreased prices on daily essentials. Prime Minister Shehbaz Sharif also directed the concerned authorities to ensure that the impact of a reduction in petroleum prices is shifted to the masses.
A decrease was also observed on week-on-week in prices of onions by (9.04%), garlic (1.76%), sugar (1.42%), wheat flour (1.40%), vegetable ghee 2.5kg (0.63%), mustard oil (0.48%), pulse masoor (0.40%), pulse gram (0.12%), diesel (10.38%), petrol (4.24%), LPG (3.02%) and firewood (0.89p%). During the previous week, out of 51 items, prices of 23 (45.09%) items increased, 7 (13.73%) items decreased and prices of 21 (41.18%) items remained unchanged.
Increase in Wheat Prices due to the Shortage
The price of wheat remained high due to the shortage being faced by flour mills on account of lower government supply. As per details, 144 flour mills in Rawalpindi and Islamabad have shutdown, and the shortage is expected to continue for at least another week. On a week-on-week basis, the biggest rise was observed in the prices of chicken (7.51%), tea Lipton (4.53%), gur (2.79%), eggs (2.29%), energy saver (2.22%), tomatoes (2.11%), tea prepared (1.09%) and curd (1.08%).
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