• A few consumer items saw price hikes.
• SPI inflation posts a rare decline of 1.2%.
• Onions saw massive 67.67% YoY price drop.
  

KARACHI: The Sensitive Price Indicator (SPI), which measures short-term inflation in Pakistan, recorded 0.35% decrease in inflation during the week ending March 20, as per the Pakistan Bureau of Statistics (PBS).

The News reported that the steep drop in vegetable prices was the main cause behind the dip; tomatoes fell the most at -7.08%, followed by onions (-6.07%), garlic (-5.59%), eggs (-4.64%), and potatoes (-2.5%). There were also slight drops in the price of necessities like sugar (-0.87%) and Lipton tea (-1.3%). An important domestic fuel source, firewood, decreased by 0.6%.

On the other hand, a few consumer items saw price hikes, such as long cloth (+1.23%), printed lawn fabric (+2.9%), LPG (+1.53%), and bananas (+1.45%). Daily necessities including bread (+0.55%), beef (+0.25%), and curd (+0.24%) all saw slight price increases.

SPI inflation, on an annual basis, posted a rare decline of 1.2%, reflecting lower prices for key staples. Onions saw a massive 67.67% price drop compared to the same period last year, while wheat flour (-35.58%), tomatoes (-29.45%), and electricity charges for the lowest consumption bracket (-18.92%) also contributed to the downward trend. Fuel prices also moderated, with diesel (-9.37%) and petrol (-8.55%) recording year-on-year (YoY) declines.

Despite the overall dip, several essential goods remained significantly more expensive than a year ago. Ladies’ sandals surged 75.09%, powdered milk rose 25.75%, and beef prices climbed 21.01%. Chicken (+18.23%), sugar (+18.65%), and vegetable ghee (+16.13%) also showed notable annual price increases, highlighting continued inflationary pressures in key food categories.

Inflationary impact varied across income segments, with lower-income households seeing a greater price decline than wealthier groups. The lowest consumption quintile recorded a 1.84% YoY drop, while the highest quintile saw a much smaller decline of 0.49%, suggesting that lower-income households may be benefitting more from the recent price adjustments.

While inflationary pressures still exist, Pakistan has been able to control inflation. According to estimates from brokerage firm Topline Securities Consumer Price Index (CPI) for March 2025 is expected to decline to a three-decade low, registering between 0.5 % and 1.0 % YoY, with a monthly increase of 0.9 %. This would bring the average inflation for the first nine months of FY25 to 5.38%, a sharp drop from 27.06% recorded in the same period last year.