ISLAMABAD: Pakistan’s inflation rate climbed back into double digits in April, with the Consumer Price Index (CPI) rising nearly 11 percent year-on-year, according to official data released on Friday. This marks the first time in 21 months that inflation has crossed the 10 percent threshold.
President Zardari Returns from China Visit After Boosting Economic Cooperation
The surge in prices was largely driven by sharp increases in transport costs and perishable food items, which rose by over 15 percent on a monthly basis. Higher fuel prices, triggered by disruptions in global energy supply, significantly impacted transportation expenses, adding pressure on household budgets.
Energy prices saw a notable rise due to continued tensions affecting the Strait of Hormuz, a critical route for global oil shipments. The resulting increase in Pakistan’s oil import bill—from $300 million to $800 million per week—has intensified inflationary pressures across the economy.
On a month-on-month basis, inflation increased by 2.48 percent in April. Urban inflation stood at 11.11 percent, slightly higher than 10.56 percent recorded in rural areas.
In response to the rising inflation, the State Bank of Pakistan raised its policy rate by 100 basis points to 11.5 percent. However, some economists have criticized the move, arguing that tightening monetary policy may not effectively address supply-driven inflation and could instead increase production costs.
Despite earlier signs of economic stabilization, the recent spike in inflation underscores ongoing challenges, particularly due to external shocks in energy markets and supply chains.
