Pakistan’s annual inflation reached a staggering 37.97% year-on-year in May, according to a report released by the statistics bureau on Thursday. This figure represents a continued uptick in the country’s highest-ever inflation.
In April, the Consumer Price Index (CPI) stood at 36.4%, which was already the highest on record, as reported by the bureau. The month-on-month rise in May was 1.58%, with the prices of vegetables, pulses, and chicken experiencing the most significant increases.
Inflation has been on an upward trend since the beginning of the year, as the government implemented painful measures as part of fiscal adjustments demanded by the International Monetary Fund (IMF) in order to unlock stalled funding, which has yet to be disbursed.
The breakdown of components reveals that food inflation in urban areas skyrocketed by an astonishing 48.1% in May 2023 compared to May 2022. Rural areas fared no better, experiencing a 52.4% year-on-year price increase.
In its Monthly Economic Outlook for May, the Ministry of Finance projected that inflation for the month would remain in the range of 34-36%. The ministry also stated that improvements in the global supply chain are expected to alleviate domestic prices in the upcoming months.
The persistently high inflation rate poses significant challenges for the Pakistani economy and the general population. Efforts to address the underlying causes of inflation, such as fiscal reforms and supply chain management, will be crucial in stabilizing prices and improving economic conditions for the country’s citizens.
