PTBP Web Desk

The Sensitive Price Index (SPI)-based inflation for the week ending January 2, 2025, recorded a minor decrease of 0.26%. The Pakistan Bureau of Statistics (PBS) attributed this drop to lower prices of essential items such as tomatoes, electricity charges, and wheat flour. The SPI fell to 326.10 points compared to 326.96 points in the previous week, marking a significant reprieve for consumers amid broader economic challenges.

Several items contributed to the weekly reduction in SPI. Tomatoes led the decline with a price drop of 13.48%, followed by a 7.48% decrease in electricity charges for Q1. Other notable price reductions included:

Potatoes: 5.59%

Pulse gram: 0.34%

Eggs: 0.23%

Wheat flour: 0.09%

These decreases provided relief to households, particularly in the lower-income brackets.

Despite the weekly decline, the year-on-year (YoY) trend showed an overall increase of 3.97%. The rise was primarily driven by significant price hikes in various commodities and services, including:

Tomatoes: 77.84%

Ladies sandals: 75.09%

Potatoes: 66.63%

Pulse gram: 47.53%

Moong: 30.73%

Powdered milk: 25.62%

Beef: 23.94%

Garlic: 17.82%

Additionally, energy and fuel prices saw notable increases, with gas charges rising by 15.52%, firewood by 13.18%, and cooked daal by 15.10%. These spikes reflect ongoing inflationary pressures affecting consumers.

The YoY analysis also highlighted major price decreases, which partially offset the overall inflationary trend. Key items with declining prices included:

Wheat flour: −36.12%

Onions: −29.95%

Chilies powder: −20.00%

Eggs: −15.78%

Electricity charges: −13.92%

Masoor: −11.24%

Rice basmati broken: −8.42%

Diesel: −6.39%

The drop in energy costs and staple food items brought some relief, particularly for middle-income households.

During the week under review, price movements varied across the 51 monitored items. The PBS reported that:

Prices of 18 items (35.29%) increased.

Prices of 10 items (19.61%) decreased.

Prices of 23 items (45.10%) remained stable.

The SPI’s impact varied across different income groups:

• Households earning up to Rs17,732 saw a 0.51% decrease in SPI.
• Those earning between Rs17,732 and Rs22,888 experienced a 0.59% decline.
• The Rs22,889–Rs29,517 group recorded a 0.28% reduction.
• Households earning Rs29,518–Rs44,175 and above Rs44,175 both saw a 0.10% decline.

This data indicates that lower-income groups benefited the most from the recent price reductions.

Despite the overall decline, several items saw price hikes during the week, including:

Chicken: 10.28%

Onions: 4.93%

Bananas: 2.20%

High-speed diesel: 1.18%

Sugar: 0.95%

Moong: 1.08%

Cooking oil (5-litre tin): 0.22%

Petrol: 0.21%

These increases underline the persistent volatility in the prices of essential goods.

The weekly decline in SPI-based inflation signals short-term relief for consumers, particularly in staple food and energy categories. However, the YoY increase highlights enduring economic challenges, with certain essential items remaining significantly more expensive compared to the previous year.

The government and relevant authorities must continue monitoring price trends and implement measures to stabilize inflation. Ensuring steady supplies of key commodities and addressing structural inefficiencies in the market will be critical in mitigating long-term inflationary pressures.