Weekly inflation eases after five-week rise as fuel price cuts offer relief

Pakistan’s weekly inflation rate has recorded a decline after five consecutive weeks of increase, with recent reductions in petroleum prices beginning to show a positive impact, according to the latest report released by the Pakistan Bureau of Statistics (PBS).

The report noted that inflation fell by 0.69 per cent on a week-on-week basis, providing some short-term relief to consumers. However, on an annual basis, inflation remains elevated, with the year-on-year rate recorded at 12.16 per cent.

Fuel price cuts drive short-term relief

The PBS attributed the weekly decline largely to a significant reduction in fuel prices. Diesel prices dropped to Rs134.58 per litre, while petrol saw a decrease of up to Rs12 per litre during the week. Liquefied petroleum gas (LPG) also became cheaper, with the price of a domestic cylinder falling by Rs230.52.

The drop in fuel costs contributed to lower prices of some essential food items. Chicken prices fell sharply by Rs44.76 per kilogram, while bananas and onions also saw modest declines. The price of a 20kg wheat flour bag decreased by Rs72, offering relief to households.

Other items that became cheaper included mash pulse, firewood, jaggery, sugar and garlic.

Mixed trend in essential commodities

Despite the overall decline, prices of several essential items increased during the week. Tomatoes rose by Rs5 per kilogram, while eggs became costlier by Rs5.15 per dozen. Fresh milk prices increased by around Rs2.5 per litre, and mutton prices rose by more than Rs5 per kilogram.

The report also noted increases in the prices of bread, yoghurt, moong pulse and ghee, along with non-food items such as clothing, shuttering materials and soap.

In total, prices of 17 items increased while an equal number saw a decline, reflecting a mixed trend in the market. Meanwhile, prices of another 17 commodities, including rice, salt and electricity, remained stable during the week.

Analysts say while the weekly dip offers some respite, persistently high annual inflation continues to weigh on household budgets.