Pakistan experienced a significant decline in consumer prices in May, with a month-on-month decrease of 3.2 pc, marking the largest drop in over two years, according to the latest report by Federal Bureau of Statistics.
The lowest reading came a week before the central bank meets to review the key rate, which has remained at a historic high of 22 pc for seven consecutive policy meetings.
In the monthly economic report released last week, Pakistan’s finance ministry projected inflation to hover between 13.5 pc and 14.5 pc in May and ease to 12.5 pc to 13.5 pc by June 2024. The Ministry of Finance’s ‘Monthly Economic Update and Outlook’ report, released on Tuesday, anticipated CPI-based inflation to stabilize within this range in May and decrease further in the coming months.
Read Dip in inflation
Pakistan has faced inflation rates above 20 pc since May 2022. In May last year, inflation surged to 38 pc as the country implemented reforms under an International Monetary Fund bailout program.
However, the inflation has slowed down to 11 pc this May.
During the first eleven months of the current fiscal year (July to May), the inflation rate decreased to 24.5 pc, compared to 29.1 pc in the same period last year.
The Bureau of Statistics reports that over the past year, electricity prices have risen by 58.7 pc, transport services by 32.2 pc, cotton clothing by 23.2 pc, onions by 86.6 pc, tomatoes by 55.4%, and spices by 39.17 pc.