Weekly inflation in Pakistan eases by 0.36% as food prices drop

Pakistan's weekly inflation rate eased by 0.36% during the week ended January 30, with significant decreases observed in the prices of key food items, according to official data released Friday.

The Pakistan Bureau of Statistics reported that the cost of tomatoes fell by 16.18%, onions by 12.32%, and potatoes by 7.66%. Other notable declines included eggs (5.09%), pulse gram (3.67%), LPG (3.21%), pulse masoor (1.32%), electricity charges for Q1 (0.99%), wheat flour bag (0.95%), and firewood (0.27%).

However, some commodities saw price increases, including bananas (4.60%), sugar (3.39%), chicken (0.93%), rice basmati broken (0.70%), cooking oil (0.40%), vegetable ghee (0.32%), beef (0.28%), and vegetable ghee (0.26%).

Compared to the same week last year, the Sensitive Price Indicator (SPI) showed an increase of 0.44%.

Analysts say the monetary measures implemented mid-2024, which included a cumulative 1,000 basis point rate cut. These measures began yielding results in the latter half of the year.

Credit growth rebounded strongly, with rates of 10.4% in October, 6.1% in November, and 7.0% in December, driven by improved financial conditions and growing business confidence.

The central bank's January 2025 monetary policy statement acknowledged the gradual improvement in economic activity.

It projected inflation to remain within the target range of 5-7% for the current fiscal year, aligning with increased economic momentum, particularly in industrial sectors such as textiles, food, and automobiles.