Karachi, June 21, 2022: The Consumer Price Index for June 2022 is likely to clock in at 19.2%, which is the highest since February 2009.
This would be substantially higher than 11MFY22 average CPI of 11.26% and May 2022 reading of 13.76%, owing to significant increase in Transport segment (weight: 5.9%) from the ongoing higher fuel prices and further jump in food inflation (weight: 34.58%).
The higher food inflation expectations are led by higher milk, meat and vegetable prices.
PDL impact, followed by second-round bearing, yet to come
The Relief Package shield has been lifted from fuel inflation, however, the government has so far only passed on the subsidy burden to the masses by announcing Rs 84/ltr (56%) increase in Petrol prices and Rs 119/ltr (82%) increase in HSD prices in the past 4 weeks.
The same would bear an impact of 0.35% on CPI reading, in addition to 45bp led by the levy of GST on the same.
The massive jump in fuel prices would also lead to snowball effect on food prices in the coming months, compounding to the sharp PKR depreciation impact and global commodity prices.