The CPI inflation soared by 13.77 percent in July 2011-12 over the same period of last year on the back of increase in the prices of food items, according to Federal Bureau of Statistics (FBS). Official figures of monthly inflation of Consumer Price index (CPI), released by the FBS, showed that inflation rose by 1.8 percent in July over previous month, and 13.77 percent over the same month of last year.
The Sensitive Price Index (SPI) and Whole Price Index (WPI) inflation increased by 17.34 percent and 21.13 percent respectively in July 2011-12 over corresponding month of previous year. Analysts have blamed government borrowing from the banking system, frequent increase in the power and gas prices along with structural issues as major reason that the country is experiencing relatively higher inflation in the region.
The central bank has mentioned in its last report that a lower than projected inflation does not provide an enduring source of comfort to the State Bank as it continues to show a high degree of persistence at an elevated level. The Finance Ministry also acknowledged in the last meeting of the Economic Co-ordination Committee of the Cabinet (ECC) that inflation was higher in Pakistan for government appetite of borrowing from the banking system for financing of the ever-increasing fiscal deficit.
An analysis of data showed a 17.58 percent food inflation in July 2011 after a 17.65 percent increase in the prices of non-perishable food items and 17.14 percent increase in perishable food items. The cost of apparel, textile and footwear went up by 30.87 percent, followed by house rent by 8.79 percent, fuel and lighting 7.41 percent, household furniture and equipment 11.56 percent, transport and communication 13.61 percent, recreation and entertainment 1.90 percent, education 7.27 percent and medicare by 17.34 percent.
The main commodities, which showed an increase in their prices during July 2011 over June 2011 in food and beverages included tomatoes (85.34 percent), chicken (18.65 percent), eggs (14.65 percent), vegetables (14.38 percent), potatoes (12.10 percent), onions (9.55 percent), gram whole (7.02 percent), pulse gram (5.25percent), gur (3.91 percent), besan (3.75 percent), sugar (3.07 percent), wheat (3.06 percent), cigarettes (3.00 percent), rice (2.94 percent), wheat flour (2.74 percent), fresh fruits (2.21 percent), maida (1.60 percent), milk products (1.44 percent), beverages (1.28 percent), milk fresh (1.20 percent) and sweetmeat and nimco (1.01 percent).
The data showed that in apparel, textile and footwear, the cost of cotton cloth went up by (1.53 percent), readymade garments (1.33 percent), silk, linen and woolen cloth (0.91 percent) and tailoring charges (0.90 percent) while in fuel & lighting, The price of natural gas/LPG increased by 1.94 percent and bulb and tube 1.14 percent.