High electricity prices push weekly inflation up in Pakistan

Pakistan’s weekly inflation nudged higher again, with energy bills replacing food items as the main driver of short-term price pressure.

New figures from the Pakistan Bureau of Statistics show the Sensitive Price Indicator (SPI) rose 0.73 percent in the seven days ending November 27. The increase was largely traced to a steep jump in electricity rates for households using the lowest consumption slab. The price of liquefied petroleum gas also moved up, tightening budgets for families already dealing with high living costs.

Pressure from power bills

Electricity charges for the poorest spending group, tracked as the first quintile (Q1), climbed 11.11 percent from a week earlier. While many households in this bracket consume less power overall, the change in tariffs for that slab still fed directly into the overall SPI increase. LPG prices, widely used in urban homes and by small businesses, went up 3.51 percent in the same week.

The pattern over a longer timeline looked similar. Compared to the same week last year, the country’s SPI was 4.32 percent higher. Economists said this indicated that, although weekly jumps remain modest, the cumulative effect of energy costs is keeping inflation stubborn.

Food items rise but vegetables fall sharply

Some everyday kitchen items also recorded small price increases. Pulse moong became 1.92 percent dearer, while vegetable ghee (2.5kg) rose 1.12 percent. Bananas were priced 0.65 percent higher, and 5-litre cooking oil inched up 0.64 percent.

Still, the most dramatic moves came on the downside, offering temporary comfort to shoppers. Tomato prices collapsed by 28.39 percent in one week, the biggest drop among all 51 monitored goods. Onions were 10.08 percent cheaper, and potatoes followed, costing 4.58 percent less. Wheat flour saw a slight fall of 0.70 percent, and salt powder was 2.47 percent lower than last week.

Market insiders said the slides in vegetable prices were tied to improved supplies from farming districts and cooler weather stabilising crop yields. However, they added the relief may not last if transport costs or energy inputs rise further in December.

Annual spikes paint mixed picture

On a year-on-year basis, sugar stood out for its 44.09 percent surge, marking it the most notable price shock of the year. Gas charges for Q1 consumers were 29.85 percent higher than a year earlier. Wheat flour, gur and beef also recorded double-digit increases of 16.35 percent, 16.24 percent and 13.46 percent, respectively.

By contrast, garlic, potatoes, pulse gram and tomatoes were much cheaper than last year, falling 38.54 percent, 34.96 percent, 28.96 percent and 26.64 percent, respectively, as strong seasonal harvests eased commodity prices.

Uneven burden across income groups

Inflation’s effects varied sharply by income. The lowest earning group, making up to Rs17,732 a month, actually saw a tiny 0.09 percent fall in their combined SPI, helped by cheaper vegetables and flour with a larger weight in their basket. The next tier, Q2 earners between Rs17,733 and Rs22,888, faced the highest weekly inflation of 0.99 percent. Q3 and Q4 groups posted smaller increases of 0.49 percent and 0.28 percent, while the top earning quintile, Q5, saw a 0.60 percent rise.

Analysts said the divergence shows how shifts in energy pricing ripple differently through household budgets, often hurting lower-middle earners the most when food costs shift less in the same week.