Pakistan is experiencing the highest annual inflation ever; food stampede kills 16 Reuters

© Reuters. FILE PHOTO: A man checks the size of a jacket at a stall selling second-hand clothes, at Landa Bazar in Karachi, Pakistan, January 15, 2023. REUTERS/Akhtar Soomro

Author: Asif Shahzad

ISLAMABAD (Reuters) – Pakistan’s consumer price inflation jumped to a record 35.37% in March from a year earlier, the statistics office said on Saturday, after at least 16 people died in a stampede seeking food aid.

March’s inflation number eclipsed February’s 31.5%, the bureau said, as food, drink and transport prices rose up to 50% year-on-year.

Thousands of people gathered at flour distribution centers set up across the country, some as part of a government-backed program to cushion the impact of inflation.

At least 16 people, including five women and three children, have been killed in stampedes at such centers in recent days, police and officials said. Thousands of sacks of flour were also looted from trucks and distribution points, according to official figures.

A spokesman for the statistics office said the inflation number was the biggest year-on-year increase the bureau had recorded since monthly records began in the 1970s.

“This is the highest recorded inflation in the data we have,” he said.

The consumer price index rose by 3.72 percent in March compared to the previous month, the bureau announced.

Higher prices for food, cooking oil and electricity pushed up the index, it said.

Annual food inflation in March amounted to 47.1 percent, respectively 50.2 percent for urban and rural areas, the office announced. Core inflation, which excludes food and energy, was 18.6% in urban areas and 23.1% in rural areas.

The South Asian country has been in economic turmoil for months with an acute balance of payments crisis, while negotiations with the IMF to secure $1.1 billion in financing as part of a $6.5 billion aid package agreed in 2019 have yet to bear fruit.

Pakistan’s foreign exchange reserves have fallen to cover barely four weeks of imports.

Inflation is expected to remain high in the monthly economic outlook report published by the finance ministry on Friday.

The report cites market frictions caused by a relative lack of demand and supply of essential commodities, exchange rate depreciation and the recent upward adjustment in fuel prices as reasons behind higher inflation expectations.

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