Short-term inflation in Pakistan stays above 29 per cent as electricity, LPG price hikes

Owing to the sharp increase in electricity and Liquefied Petroleum Gas prices, short-term inflation has witnessed a year-on-year surge of 29.21 per cent for the week ending on July 26, according to official data Dawn reported.

The short-term inflation on a week-on-week basis measured by the Sensitive Price Index (SPI), rose 3.73 per cent which marks the highest increase in the past two months.

Moreover, the electricity charges were surged by 20.98 per cent, whereas, LPG was increased by 4.12 per cent during the period under review, the Pakistan-based daily reported.


Out of 51 items in the SPI basket, prices of 20 goods saw a sharp rise, whereas prices of seven items dropped and other 24 remained unchanged compared to the previous week.

However, the biggest rise in prices was recorded on a week-on-week basis and the items included powdered chillies, tomatoes, eggs, LPG, garlic, onion, gur, and potatoes, according to Dawn.

Additionally, the depreciation of the rupee, soaring petrol prices, increase in sales tax and higher electricity bills are some of the main factors contributing to the rising inflation.

To generate revenue for bridging the fiscal deficit, the Pakistan government has been taking strict actions by increasing fuel prices and power tariffs, withdrawal of subsidies, market-based exchange rate and higher taxation. Such harsh actions may cause slow economic growth and higher inflation in upcoming months, reported Dawn.