The Ministry of Finance announced on Thursday that inflation during the first six months of FY2024-25 (July-December) dropped to 7.2%, a significant decline compared to 28.8% in the same period last year. In December 2024, inflation fell further to 4.1%, marking the lowest level in 80 months since April 2018, when it stood at 3.96%.
The sharp reduction in inflation is attributed to exchange rate stability, prudent fiscal management, and improved supply chains for essential commodities. The government’s crackdown on illegal foreign exchange operators, smuggling, and hoarding has played a key role in stabilizing the exchange rate, boosting market confidence, and ensuring a steady supply of goods.
The Sensitive Price Index (SPI), which monitors the weekly price movement of 51 essential items, has shown a consistent decline over the past four weeks of January 2025. In the week ending January 23, 2025, the SPI recorded a 0.77% decrease, reflecting a downward trend in the prices of essential goods. During this period, prices of 12 items decreased, 14 increased, and 25 remained stable, indicating overall price stability.
The Economic Coordination Committee (ECC) took action in response to an abnormal rise in the prices of pulses and chicken in early November. As a result, significant price reductions were observed:
- Gram pulse: Decreased by Rs. 52.5 per kg (from Rs. 411.3 to Rs. 358.8).
- Mash pulse: Dropped by Rs. 37.4 per kg (from Rs. 528.3 to Rs. 490.9).
- Chicken: Reduced by Rs. 20.1 per kg (from Rs. 460.6 to Rs. 440.5).
- 20kg wheat flour bag: Fell by Rs. 1022.2 (from Rs. 2816.5 to Rs. 1794.3).
Over the past month, prices of essential items such as tomatoes, potatoes, pulses, eggs, and LPG have also seen significant declines. The latest data from the Pakistan Bureau of Statistics (PBS) highlights the effectiveness of government policy interventions, administrative measures, and relief efforts in controlling inflationary pressures.
