Pakistan inflation spikes to 31.4 pc amid high fuel, energy prices

Pakistan faces an uphill task when it comes to economic recovery under a caretaker government following the approval of a $3 billion loan by the International Monetary Fund in July

Karachi: Inflation in Pakistan rose to 31.4 per cent year-on-year in September from 27.4 per cent in August, data from the Pakistan Bureau of Statistics (PBS) showed Monday, as the nation faces high fuel and power rates, The News reported.

The South Asian nation faces an uphill task when it comes to economic recovery under a caretaker government following the approval of a $3 billion loan by the International Monetary Fund in July. The loan from the Washington-based lender helped the nation avert a sovereign default, but the conditions that came with it have made it difficult for the authorities to rein in inflation, The News reported.

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PBS data showed that on a month-on-month basis, inflation climbed 2 per cent in September, compared to an increase of 1.7 per cent in August. The annual inflation already stands at a historic high of 38 per cent, recorded in May — courtesy of IMF’s reforms, including the removal of subsidies and easing of curbs on imports, The News reported.

The benchmark interest rates have also climbed to their highest at 22per cent, with the rupee hitting an all-time low against the dollar in August before recovering due to a crackdown on illegal greenback smugglers.

The Ministry of Finance, in its monthly report, said last week that it anticipates inflation to remain high in the coming month — hovering around 29-31 per cent — due to a surge in petrol and energy tariffs.