Inflation in Pakistan has not fallen below 10 percent by the end of June this year. The government has failed to keep inflation within the target of 8.5 percent, according to the government’s latest figures.
Figures show that food sales rose sharply from July 2019 to June 2020. And it also says that food prices have risen by 15 per cent in rural areas and by about 13 per cent in urban areas.
In Pakistan, the share of food and beverages in a pair of baskets is 34.5 per cent to measure inflation at the government level. The Ministry of Finance says food sales have risen due to irregularities and stockpiling of food flour. Despite rising inflation, Pakistan has set a inflation target of 6.5 percent in the new fiscal year, but economists say inflation will hardly fall below that target.
Inflation in Pakistan has been declining for the past three months since the outbreak of the coronavirus, but now researchers and experts fear a resurgence of inflation.
Wakil Rehman, an economist and journalist, says interest rates have been cut by the government, and oil prices have risen again, which will have an impact on the general public this month and in the coming months.
According to the Pakistan Census Bureau, the overall inflation rate in 2019-20 has not come down to less than 10.76 per cent as against 11.01 per cent in 2011-12.
Economist Lahaz Ali argues that the fall in inflation over the past three months has been linked to lower purchasing power because of the Corona epidemic, which has hampered economic efforts and reduced people’s purchasing power.
He added that the government had stopped charging electricity and gas bills at that time but the people were still unable to pay the bills and the impact would be felt in the future.
Inflation was 12.4 percent in February 2020, but fell to 10.4 percent in March due to the Corona epidemic, the study said.
Inflation was 8.5 percent in April and the government has since cut interest rates from 13.25 percent to 7 percent.
The government had set a gross inflation rate of 9.1 percent for 2019 and 20th, but the target has not been met despite declining for three consecutive months.