For the fifth month in a row, the inflation rate skyrocketed to another peak of 13% in January – the highest pace in nearly two years that also beat the government’s expectations.
The fresh inflation reading may also impact the interest rates by the State Bank of Pakistan (SBP) which is now following the headline inflation number to determine the policy rate instead of core inflation.
The Consumer Price Index (CPI) jumped to 13% in January over the same month a year ago, the Pakistan Bureau of Statistics (PBS) reported on Tuesday – a day after Prime Minister Imran Khan deferred a summary to increase the price of petroleum products.
Analysts had already anticipated inflation to be in double digits and the current CPI inflation was in line with their expected targets.
They had predicted inflation to remain high year-on-year because of base inflation being low last year, however, they had mentioned that the inflation rate depended on three factors; electricity prices, rupee-dollar parity and international commodity prices.
On a month-on-month basis, inflation remained “flattish”, slightly rising by 0.4% owing to an increase in food inflation.
