Pakistan: Inflation rises to 13-year high of 21.3% in June, expected to rise further

The ongoing economic crisis in Pakistan is now getting worse by the day. Data from Pakistan's Bureau of Statistics (PBS) shows that inflation rate, which is measured by the Consumer Price Index (CPI), was at 13.76% in May.

In the month of June, inflation in Pakistan increased to 21.32%, which is the highest in the last 13 years, according to reports. Multiple sectors witnessed a double-digit inflation rate but the highest inflation rate was seen in the transportation sector at 62.17% and perishable food items also saw an increase in prices by 36.34%.

Other sections in which inflation was measured in the double digits are: Non-perishable food items (24.43pc), Restaurants and hotels (21.85pc), Clothing and footwear (13.72), Alcoholic beverages and tobacco (17.6pc).

Meanwhile, other sectors such as Health, Housing and utilities, Education, Recreation and Culture have also seen a significant rate of inflation in Pakistan.

Cash-strapped Pakistan is facing growing economic challenges, with high inflation, sliding forex reserves, a widening current account deficit and a depreciating currency.

Earlier the Finance Ministry of Pakistan had warned that inflation will go beyond 15pc in the upcoming financial year, which begins from July 1 in Pakistan.

The Economic Adviser’s Wing (EAW) Monthly Economic Update for June & Outlook had previously said, “Despite achieving the growth of 5.97pc in FY2022, the underlying macroeconomic imbalances associated with domestic and international risks are making growth outlook indistinct.”

The State Bank of Pakistan's (SBP) demand management policy may fail as a result of supply restrictions and increasing global commodity prices, according to the EAW, adding that it may further lower income levels.

Finance Minister blames former government of Imran Khan for Pakistan's economic crisis

Pakistan Finance Minister Miftah Ismail on Thursday while addressing a press conference in Islamabad stated that the government was not in a position to bear more subsidies anymore, therefore necessitating the hikes. He further also criticised the former government's policies and said that they “deteriorated the country’s economy”.

Adding more to it, he also asserted that the incumbent government is facing the brunt of the former government's doings and due to this, Pakistan is presently bearing a loss of PKR 24.3 on petrol, PKR 59.16 on diesel, PKR 39.49 on kerosene oil, and PKR 39.16 on light diesel oil. 

(With inputs from ANI)