For the seven days that concluded on March 23, 2023, the price of wheat flour reached an all-time high, driving weekly inflation up 1.80% week over week and 46.65% year over year, indicating even worse times ahead.
Pakistan Bureau of Statistics (PBS) data issued on Friday attributed the surge in the sensitive price indicator (SPI) to the increase in prices of:
- Tomatoes (71.77%)
- Wheat flour (42.32%)
- Potatoes (11.47%)
- Bananas (11.07%)
- Tea (7.34%)
- Georgette (2.11%)
- Lawn (1.77%)
- Long cloth (1.58%)
- Pulse mash (1.57%)
- Prepared tea (1.32%)
- Gur (1.03%)
On the other hand, PBS noted a decrease in the prices of :
- Chicken (8.14%)
- Chilli powder (2.31%)
- LPG (1.31%)
- Mustard oil and garlic (1.19%) each,
- Pulse gram and onions (1.06%) each
- Vegetable ghee 1kg (0.83%)
- Cooking oil 5 liters (0.21%)
- Pulse moong (0.17%)
- Pulse masoor (0.15%)
- Eggs (0.03%)
The SPI was measured at 250.66 points for the week under review compared to 246.22 points the week prior and 170.92 points during the week ending March 24, 2022.
In his weekly note, Fahad Rauf, the head of research at Ismail Iqbal Securities, stated that the price of a 20kg bag of wheat flour, which has risen to an all-time high of Rs2,586, is the main cause of the SPI’s huge climb. On the other hand, WoW chicken prices have dropped by 8%.
“The modification of the subsidy mechanism is the primary cause of the rise in wheat prices. The government has now changed from a general subsidy to a targeted subsidy through BISP [Benazir Income Support Programme],” he added, adding with the advent of Ramadan, food costs would continue to rise. “We anticipate the consumer price index for March 2023 to come in at 35.5% YoY,” Rauf continued.
