Inflation may decline to 12.5 per cent by June 2024

WEB DESK: Inflation is projected to remain between 13.5 per cent and 14.5 per cent in May 2024, with a potential decrease to 12.5 per cent to 13.5 per cent by June 2024, according to the Finance Ministry’s latest economic report.

The report highlights a downward trend in inflation, which can be attributed to high inflation levels from the previous year and improvements in the domestic supply chain for perishable items and staple foods like wheat. Additionally, reductions in transportation costs have played a significant role.

The government’s commitment to controlling inflation through stringent administrative measures has contributed to a positive outlook.

A crucial part of this strategy involves ensuring the steady availability of food items, which helps to mitigate inflationary pressures. According to MG, by effectively managing supply and demand, the government aims to stabilise prices and reduce market volatility.

In May 2024, the prices of petroleum products were reduced twice, which positively impacted the Consumer Price Index (CPI) for the month. Lower fuel prices have led to reduced transportation costs, further contributing to the favourable CPI trend.

Additionally, the Sensitive Price Indicator (SPI) has declined for the sixth consecutive week, indicating a promising outlook for the CPI.

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