Source: The News
Date: October 12, 2010
KARACHI: The country’s headline inflation hit a 17-month high of 15.71 percent year-on year in September owing to the impact of devastating floods, which resulted in a sharp increase in the prices of basic food items, according to the Federal Bureau of Statistics (FBS) data issued on Monday.
The consumer price Index (CPI), the key barometer to gauge inflation in the country, registered a growth of 17.19 percent in April 2009. Analysts said that the impact of floods was the main reason behind the current increase in inflation. The depreciation of rupee and a global increase in commodity prices also kept the domestic rates on the higher side.
“The CPI figures are alarming and it may force the State Bank of Pakistan (SBP) to further tighten its monetary policy stance next month,” said Ahsan Mehanti, Director, Arif Habib Investments Ltd.
Realising persistent inflationary pressure, the central bank increased the discount rate to 13.5 from 13 percent in the last monetary policy announcement on Sept 29. The floods, which started hurting the economy early this fiscal year, dented the agriculture infrastructure and standing crops.
There are no exact estimates of devastations caused by the recent calamity, but the provisional estimates of the central bank suggested that the economic growth for the current fiscal year could come down to 2.5 percent from an earlier target of 4.5 percent.
The disruption in supply chain of food items caused the month-on-month food inflation to jump to 5.26 percent in Sep, pushing the monthly CPI inflation to 2.65 percent.The central bank said that the upward trend in food inflation would take two to three months to return to normal levels.
For more details: http://thenews.com.pk/12-10-2010/ethenews/e-9566.htm
No comments:
Post a Comment