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Wednesday, May 18, 2022
HomeBusinessInflation in April reaches two-year high

Inflation in April reaches two-year high

Food and energy prices found to be main contributors in increased inflation

Inflation reached a two-year high of 13.37 percent in April 2022, only 1.6 percent higher than last month in the same month in the previous year, a local newspaper reported citing Pakistan Bureau of Statistics.

The PBS’ Consumer Price Index shows food and energy costs as the main factors to the increase in inflation.

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The ten-month average inflation rate (July-April 2021-22) climbed to 11.04%, surpassing the State Bank of Pakistan’s expected upper limit for inflation. The central bank estimated the CPI to be at 9-11% by the end of this fiscal year.

Similarly, the International Monetary Fund (IMF) cautioned Pakistan, in its current World Economic Outlook, and said that increasing inflation and the outward environment had amplified short-term risks. The fund reviewed its previous forecasts, anticipating that Pakistan’s current account deficit (CAD) would reach $18.5 billion and average inflation would be at 12.7% by this fiscal year.

According to economists, increasing food prices were the primary factor, followed by vehicle fuels and electricity charges. They have said that the recent surge in inflation was caused because of supply chain disruptions, high transportation charges, and surging global commodity prices.

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