Pakistan’s Consumer Price Index (CPI) based inflation for August 2023 rose to 27.4 percent year-on-year, a slight decrease from the 28.3 percent recorded in the previous month and 27.3 percent in August 2022, according to the Pakistan Bureau of Statistics (PBS). On a month-on-month basis, inflation increased by 1.7 percent in August 2023, down from the 3.5 percent increase in the previous month and 2.4 percent in August 2022.

The coming months may witness a further rise in inflation due to substantial increases in petroleum prices. However, inflation is not solely attributed to petroleum prices. The rapid depreciation of the rupee against the US dollar in recent weeks could also contribute to rising inflation.

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Protests have erupted across the country in response to inflated electricity bills, as the interim government faces challenges in providing relief while adhering to agreements with the International Monetary Fund (IMF).

In terms of urban and rural inflation:

• Urban CPI inflation stood at 25.0 percent year-on-year in August 2023, compared to 26.3 percent in the previous month and 26.2 percent in August 2022. On a month-on-month basis, it increased by 1.6 percent in August 2023, down from the 3.6 percent increase in the previous month and 2.6 percent in August 2022.
• Rural CPI inflation reached 30.9 percent year-on-year in August 2023, a decrease from the 31.3 percent recorded in the previous month but higher than the 28.8 percent in August 2022. On a month-on-month basis, it increased by 1.9 percent in August 2023, down from the 3.3 percent increase in the previous month and 2.2 percent in August 2022.

Additionally, the Sensitive Price Index (SPI) inflation for August 2023 increased to 27.9 percent year-on-year, a decrease from the 29.3 percent in the previous month and 34.0 percent in August 2022. On a month-on-month basis, it increased by 4.1 percent in August 2023, up from the 2.8 percent increase in the previous month and 5.2 percent in August 2022.

Wholesale Price Index (WPI) inflation on a year-on-year basis increased to 24.3 percent in August 2023, up from 23.1 percent in the previous month but lower than the 41.2 percent in August 2022. On a month-on-month basis, it increased by 4.2 percent in August 2023, up from the 2.5 percent increase in the previous month and 3.1 percent in August 2022.