Inflation Monitor

March 2010

State Bank of Pakistan

Economic Analysis Department
Inflation Monitor, March 2010

ISSN 1992-8327 (print)

ISSN 1992-8335 (online)
The analysis in this document is based on data provided by
Federal Bureau of Statistics, Pakistan.
http://www.sbp.org.pk/publications/Inflation_Monitor

© 2010 State Bank of Pakistan

 State Bank of Pakistan

Contents

1. Overview 1
2. Consumer Price Index 4
2.1 Food Inflation 5
2.2 Non-food Inflation 8
2.3 City-wise Inflation 10
2.4 Income Group-wise Inflation 11
2.5 Services and Non-services Inflation 12

3. Wholesale Price Index 13

4. Sensitive Price Indicator 16

5. Global Commodity Prices 18

Annexure A: 22
Table A1: CPI Inflation (YoY) by Groups
Table A2: Distribution of Price Changes of CPI Basket, March 2010
Table A3: Top Ten Contributors to YoY CPI Inflation in March 2010 (YoY)
Table A4: Distribution of YoY Price Changes - Selected CPI Items March 2010
Table A5: City-wise CPI Inflation (YoY) by Income Groups March 2010
Table A6: Income Group-wise CPI Inflation
Table A7: Distribution of Wholesale Price Changes (YoY), March 2010
Table A8: SPI Item-wise Price Movements for the month of March 2010
Table A9: Consumer Price Index Numbers by Major Groups and Selected
Commodities for March 2010
Table A10: Wholesale Price Index Numbers by Major Groups and Selected
Commodities for March 2010
Table A11: Price Indices-Base 2000-01=100
Table A12: International Commodity Prices/Indices

Figure A1: CPI Non-food Inflation

Figure A2: Frequency Distribution of Price Changes of CPI Items March 2010
Figure A3: Frequency Distribution of Price Changes of WPI Items March 2010

Annexure B: Technical Notes 38

Inflation Monitor, March 2010

Team
Mr. Moinuddin moinuddin@sbp.org.pk
Mr. Saghir Pervaiz Ghauri saghir.pervaiz@sbp.org.pk
Mr. Waseem Fazal Ur Rehman waseem.fazal@sbp.org.pk
Mr. Zahid Hussain zahid.hussain@sbp.org.pk

Editorial Assistance
Mr. Umar Siddique umar.siddique@sbp.org.pk
Overview
All price indices indicate that inflationary pressures remained strong in the
economy. Headline CPI inflation (YoY) at 12.9 percent during March 2010 was
marginally lower than 13.0 percent recorded in February 2010. WPI inflation
(YoY), increased significantly to 21.8 percent in March 2010 from 19.3 percent
during February 2010. Similarly, SPI inflation (YoY) recorded at 17.6 percent
during March 2010 compared to 17.2 percent in the previous month (see Table
1.1 & 1.2).
Table 1.1: Inflation Trends
percent
CPI Core Inflation
General Food Non-food NFNE * Trimmed WPI SPI**
YoY MoM YoY MoM YoY MoM YoY MoM YoY MoM YoY MoM YoY MoM
Mar-09 19.1 1.4 19.7 2.2 18.5 0.7 18.5 0.9 19.3 0.8 11.1 0.4 19.8 0.8
Apr-09 17.2 1.4 17.0 2.0 17.3 0.9 17.7 1.1 17.6 1.2 8.3 1.7 15.0 1.2
May-09 14.4 0.2 12.1 -0.2 16.3 0.6 16.6 0.8 16.7 0.9 4.7 1.5 11.0 0.8
Jun-09 13.1 1.0 10.5 1.0 15.4 1.0 15.9 0.7 15.5 0.8 4.1 2.4 10.8 1.2
Jul-09 11.2 1.5 10.7 3.0 11.6 0.3 14.0 0.7 13.9 0.8 0.5 0.7 9.4 3.2
Aug-09 10.7 1.7 10.6 2.5 10.8 1.0 12.6 0.8 13.1 1.1 0.3 2.2 7.8 1.4
Sep-09 10.1 0.5 10.0 0.4 10.2 0.5 11.9 0.8 12.4 0.6 0.7 0.2 8.5 1.0
Oct-09 8.9 1.0 7.5 1.1 10.0 0.8 11.0 0.8 10.6 0.8 3.8 1.2 6.7 0.2
Nov-09 10.5 1.4 11.1 1.8 10.0 1.0 10.6 0.8 10.5 0.7 12.5 2.8 10.0 1.9
Dec-09 10.5 -0.5 10.9 -1.7 10.2 0.6 10.7 0.7 10.4 0.6 15.0 0.2 11.9 0.3
Jan-10 13.7 2.4 15.5 2.0 12.2 2.8 10.3 0.7 12.7 1.3 19.6 4.2 17.8 3.2
Feb-10 13.0 0.4 14.9 0.1 11.5 0.6 10.1 0.8 12.4 0.7 19.3 0.4 17.2 0.9
Mar-10 12.9 1.3 14.5 1.8 11.6 0.8 9.9 0.8 12.7 0.8 21.8 2.5 17.6 1.1
* NFNE is Non-food non-energy inflation; ** SPI for all income groups combined.

Core inflation measures show a mixed picture. Non-food non-energy (NFNE)

dropped to a 23-month low of 9.9 percent during March 2010. However, the other
measure of core inflation, 20% trimmed mean recorded an increase of 0.3
percentage points during March 2010 compared with the preceding month. This
suggests that strong inflationary pressures are largely concentrated in food and
energy sub-groups. The surge in energy inflation was due to inevitable adjustment
in administered prices of key fuels and electricity tariff. While persistently high
food inflation is attributed to increased transportation costs, as well as, lower
domestic availability of some commodities amidst lower production or higher
exports.

The other major reasons for sustained inflationary pressures during recent months
are: (a) rise in international commodity prices specifically cotton, crude oil, and
metals; (b) recovery in domestic demand; and (c) higher administered energy
prices .
Inflation Monitor, March 2010

It is also important to note that although YoY CPI inflation marginally declined in
February-March 2010, the annualized inflation measured by period average
showed acceleration and reached 11.3 percent by March 2010 (see Table 1.2 &
Figure 1.1).

Tabl e 1.2: Di ffe re n t Di m e n s i on s of In fl ati on (pe rce n t) 5-ye ar

Mar-08 Mar-09 Fe b-10 Mar-10 ave rage #
Year-on-year
O ve ral l C PI 14.1 19.1 13.0 12.9 11.6
Food group 20.6 19.7 14.9 14.5 14.0
Non-food group 9.4 18.5 11.5 11.6 9.9
W PI 19.8 11.1 19.3 21.8 10.4
Food group 21.0 19.5 15.4 16.3 13.4
Non-food group 18.9 4.8 22.6 26.5 8.2
S PI 16.2 19.8 17.2 17.6 12.7
C ore In fl ati on
NFNE* 9.3 18.5 10.1 9.9 9.7
T rimmed 11.3 19.3 12.4 12.7 10.5
P eriod average
O ve ral l C PI 9.5 23.0 11.1 11.3 11.6
Food group 13.8 27.8 11.4 11.7 14.4
Non-food group 6.3 19.2 10.8 10.9 9.5
W PI 12.6 23.1 8.7 10.1 12.0
Food group 15.8 27.2 10.3 11.0 13.9
Non-food group 10.3 20.0 7.4 9.4 10.6
S PI 10.6 26.7 11.1 11.8 13.3
C ore In fl ati on
NFNE* 7.1 17.9 11.4 11.2 9.2
T rimmed 8.7 20.4 11.8 11.8 10.4
12-mont h moving average
O ve ral l C PI 8.9 22.1 12.6 12.1 11.2
Food group 13.0 28.0 12.4 12.1 14.1
Non-food group 6.0 17.6 12.7 12.2 9.1
W PI 11.2 24.1 8.1 9.0 12.0
Food group 14.4 27.3 11.6 11.4 13.7
Non-food group 8.8 21.7 5.4 7.1 10.9
S PI 10.0 26.3 12.0 11.9 13.0
C ore In fl ati on
NFNE* 6.7 16.5 13.2 12.5 8.7
T rimmed 8.4 19.4 13.7 13.0 10.1
Mont hly
O ve ral l C PI 3.1 1.4 0.4 1.3 1.3
Food group 4.9 2.2 0.1 1.8 2.1
Non-food group 1.7 0.7 0.6 0.8 0.7
W PI 4.0 0.4 0.4 2.5 1.4
Food group 3.0 0.9 0.5 1.7 1.2
Non-food group 4.7 0.0 0.2 3.2 1.5
S PI 4.2 0.8 0.9 1.1 1.5
C ore In fl ati on
NFNE* 1.3 0.9 0.8 0.8 0.7
T rimmed 2.1 0.8 0.7 0.8 0.8
# 5-year average for t he mont h of January in t he previous years

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 State Bank of Pakistan

Figure 1.1: Movements in Price Indices (percent change)

Year-on-year 12-month moving average Month-on-month (RHS)

26 4
CPI
23
3
20

17 2

14 1
11
0
8

5 -1
Nov-07

Nov-08
Nov-06

Nov-09
Mar-07

Mar-08
Mar-06

Mar-09

Mar-10
Jul-06

Jul-09
Jul-07

Jul-08
36 3 32 3
NFNE 20% Trimmed Mean
32 28
2 2
28 24
24 2 2
20
20
16 1
16 1
12
12 1
1 8
8
4 0
4 0

32 6
36 6 SPI
WPI 28 5
32
4 4
28 24
3
24 2
20 2
20
0 16 1
16
0
12 -2 12
-1
8 8
-4 -2
4
4 -3
0 -6
Mar-06

Mar-08

Mar-10
Mar-07

Mar-09
Nov-06

Nov-07

Nov-09
Nov-08
Jul-06

Jul-08

Jul-09
Jul-07
Nov-07

Nov-09
Nov-06

Nov-08
Mar-07

Mar-09
Mar-06

Mar-08

Mar-10
Jul-06

Jul-08
Jul-07

Jul-09

3
Inflation Monitor, March 2010

2. Consumer Price Index

Although CPI inflation (YoY) slightly declined to 12.9 percent during March 2010
from 13.0 percent in the previous month, it remained strong (see Figure 2.1). This
marginal decline was mainly attributed to decline in the prices of perishable food
items. In contrast to CPI YoY inflation, inflation based on month-on-month
(MoM) showed a significant acceleration, i.e., from 0.4 percent during February
2010 to 1.3 percent in March 2010 (see Figure 2.2).

Figure 2.1: Consumer Price Inflation (YoY) Figure 2.2: Consumer Price Inflaion (MoM)
Overall Food Non-food Overall Food Non-food
35 5.0
30 3.5
percent
25
percent

2.0
20
0.5
15
-1.0
10
5 -2.5

May-09
May-08
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Nov-08

Nov-09
Jul-08

Jul-09
May-09
May-08
Mar-08

Mar-09

Mar-10
Sep-09
Sep-08

Jan-09

Jan-10
Nov-08

Nov-09
Jul-08

Jul-09

CPI inflation is principally driven by high food inflation, despite some ease during
the preceding two months. It is also evident from its disproportionately higher
weighted contribution to overall CPI inflation. The weighted contribution of food
inflation to overall CPI inflation registered at 50.5 percent during March 2010
compared to 50.9 percent in the previous month. Therefore, weighted contribution
of non-food group was 49.5 percent during March 2010; significantly lower than
its weight in CPI basket, i.e., 59.66 percent (see Figure 2.3).

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 State Bank of Pakistan

Figure 2.3: Weighted Contribution to CPI Inflation (YoY)

Others Transport & communication Fuel & lighting House rent Food

95%

75%

55%

35%

15%

-5%
May-09
Mar-09

Mar-10
Sep-09

Feb-10
Jan-10
Aug-09

Nov-09
Jul-09
Apr-09

Jun-09

Dec-09
Oct-09

2.1 Food Inflation

CPI food inflation remained Figure 2.4: CPI Food Inflation
high at 14.5 percent YoY in YoY 12-month moving average MoM (rhs)
March 2010; but slightly lower 35
31 5.0
than 14.9 percent in the
27
preceding month (see Figure 3.0
23
percent

2.4). 19
1.0
15
This marginal decline in CPI 11 -1.0
food inflation (YoY) was 7
mainly due to fall in the prices 3 -3.0
Mar-08

Mar-09

Mar-10
Nov-08

Nov-09
May-08

May-09
Sep-08

Sep-09
Jan-09

Jan-10
Jul-08

Jul-09

of some key food staples like

tomatoes, onions, vegetables,
sugar, gur, and fresh fruits
compared to the corresponding month; however rise in the prices of most of the
food items was still in double digits. However significant increase in CPI food
inflation on MoM basis was mainly attributed by sharp increase in the prices of
potatoes, onions, chicken, cigarettes, vegetables, and fresh fruits during March
2010 relative to February 2010.

Six out of top ten weighted contributions to CPI inflation (YoY) were from food
group during March 2010, including wheat flour, fresh milk, sugar, meat,
vegetables, and vegetable ghee. Combined weighted contribution of these food
items in the overall CPI food inflation was 38.5 percent. Within the food group,
just four items, i.e., wheat flour, fresh milk, meat, and sugar contributed 61.4
percent to YoY food inflation (see Table A3 in Annexure A). It is important to

5
Inflation Monitor, March 2010

note that a decline in international wheat prices did not translate in domestic retail
prices due to significantly high support price. In addition, pass through of decline
in international sugar prices to domestic retail prices was quite weak. This is due
to high cost of production and speculative hoarding amid lower arrival of imported
sugar.

Detailed analysis of price movement in CPI food basket revealed that out of the
reported 107 commodities, 55 commodities including pulse moong, mash, ginger,
sugar, potatoes etc. exhibited price changes (YoY) in the range of 10 to 90 percent
during March 2010. Two commodities of food group witnessed more than 100
percent price change (YoY), including cardamom small (109.3 percent) and garlic
(287.5 percent). On the other hand, prices of 12 commodities, onions, tomatoes,
green chillies, rice basmati, etc. declined, whereas 8 showed no change in prices
during the month under review. Remaining 30 commodities showed price change
(YoY) between 0 to 10 percent (see Figure 2.5 & Table A2).
Figure 2.5: Price Trends in Key Food Items

YoY inflation 12mma Price (RHS)

Wheat flour Milk
87 330 29 44
300 41
72
Rs per 10kg

24 38
percent

270

Rs per ltr
57
percent

35
240
42 19 32
210 29
27 180 14 26
12 150 23
-3 120 9 20

100 Pulse Mash 150 Chicken

60 150
80 130
45
Rs per kg

100
percent
percent

60
Rs per kg

110
30
40 90
50
20 15
70
0 0 0 50
Pulse Mong Sugar
100 80
84 75
90 70
64 80 55
Rs per kg

60
44 70 35
percent

50
Rs per kg

60
percent

24 15 40
50
4 -5 30
40
-16 30 -25 20
Jun-08

Jun-09
Dec-08

Dec-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jun-08

Jun-09
Dec-08

Dec-09
Mar-08

Mar-09

Mar-10
Sep-09
Sep-08

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 State Bank of Pakistan

During March 2010, food inflation on month-on-month (MoM) basis was 1.8
percent compared to 0.1 percent during the previous month. Commodity-wise
analysis of price change on MoM basis of the CPI food basket showed that 7
commodities including green chillies, kinnu, chicken, ginger, malta, potatoes and
radish, recorded a double digit price change during March 2010, whereas 20
commodities including tomatoes, sugar, gur, wheat flour, pulse masoor etc.
declined. In contrast to the previous month, onions, potatoes, and green chillies
recorded significant acceleration (from negative to positive price change) during
March 2010.

Further disaggregation (of 40 composite food items in the CPI basket) can be
made on the basis of perishable and non-perishable commodities. Inflation (YoY)
in the perishable group was 2.3 percent during March 2010, which was
significantly lower than 12.5 percent in the previous month and 14.1 percent in the
same month last year. Whereas inflation in perishable commodities on MoM basis
showed increase and was recorded at 6.6 percent during March 2010 compared to
(-) 5.7 percent in February 2010. Prices of perishable commodities are often
volatile and this was clearly seen in both YoY and MoM inflation numbers.
Inflation (YoY) in non-perishable commodities also increased to 16.3 percent in
March 2010 compared to 15.2 percent in February 2010 and 20.6 percent in the
corresponding month last year. Inflation (MoM) in this group of commodities also
increased to 1.2 percent during March 2010 compared to 0.9 percent in the
previous month (see Figure 2.6 & 2.7).

Figure 2.6: Non-perishable & perishable food Figure 2.7: Non-perishable & perishable food
items Inflation (YoY) items Inflation (MoM)
Non-perishable Perishable Non-perishable Perishable
Overall CPI Overall CPI
40 20
35 15
30 10
percent

25 5
percent

20 0
15 -5
10 -10
5 -15
0 -20
Mar-08

Mar-10
Mar-09
Sep-08

Sep-09
Jun-08

Jun-09
Dec-08

Dec-09

Jun-08

Jun-09
Dec-08

Dec-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09

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Inflation Monitor, March 2010

2.2 Non-food Inflation

Contrary to trends in overall Figure 2.8: CPI Non-food Inflation
CPI and CPI food inflation YoY 12-month moving average MoM (rhs)
(YoY), CPI non-food inflation 21 4.0
exhibited marginal increase 18 3.5
3.0
during the month under review 15 2.5

percent
compared to February 2010; 12 2.0
however it was still lower than 9 1.5
the same month last year. CPI 1.0
6 0.5
non-food inflation (YoY) was
recorded at 11.6 percent during 3 0.0

Nov-09
Nov-08
May-08

May-09

Mar-10
Mar-08

Mar-09
Sep-08

Sep-09

Jan-10
Jan-09
Jul-08

Jul-09
March 2010 compared to 11.5
percent in the previous month
and 18.5 percent in March
2009. Similarly CPI non-food inflation (MoM) also increased from 0.6 percent in
February 2010 to 0.8 percent during March 2010 (see Figure 2.8). Out of the nine
sub-groups of non-food group, inflation (YoY) in three sub-groups showed
increase during March 2010.

Inflation (YoY) in transport & Figure 2.9: Transport & Communication Inflation
communication sub-group YoY 12-month moving average MoM (rhs)
increased during March 2010, 12.0
35
which is a result of increase in 8.0
28
the prices of key fuels.
percent

4.0
Inflation (YoY) in this sub- 21
0.0
group reached 14.0 percent 14
7 -4.0
during March 2010 from 10.4
0 -8.0
percent in February 2010. It
was, however, still lower than -7 -12.0
May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Nov-08

Nov-09
Jul-09
Jul-08

17.8 percent in March 2009.

On month-on-month basis,
inflation in this sub-group also
increased to 3.4 percent during the month under review compared to 1.1 percent
last month (see Figure 2.9).

Apparel, textile & footwear sub-group’s inflation (YoY) increased during March
2010 to 6.1 percent compared to 5.6 percent in February 2010. However, it was
significantly lower when compared with the corresponding month last year (13.6
percent). Similarly, inflation (MoM) in this sub-group also increased and reached
0.8 percent during March 2010 compared with 0.7 percent in the previous month
(see Figure 2.10). The rise in inflation in this sub-group was principally a function
of record high prices of cotton in international and domestic markets.

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 State Bank of Pakistan

Inflation (YoY) in house rent Figure 2.10: Apparel, Textile & Footwear Inflation
index (HRI) continued on YoY 12-month moving average MoM (rhs)
declining trend since June 2009 18 4.5
to reach 12.0 percent during 16 4.0
14 3.5
March 2010 compared to 12.7

percent
12 3.0
percent in February 2010 and 10 2.5
18.7 percent in the same month 8 2.0
last year. Inflation on month- 6 1.5
on-month basis, in this sub- 4 1.0
2 0.5
group also decreased to 0.6 0 0.0
percent during March 2010

Nov-08

Nov-09
May-09
May-08
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Jul-08

Jul-09
compared to 0.8 percent in
February 2010. Although
inflation in this sub-group
declined, the trend is expected to bottom out in coming months due to continuous
rise in international metal prices.

Inflation (YoY) in fuel & lighting, household furniture & equipment, education
and cleaning, laundry & personal appearance sub-groups of CPI non-food
declined during March 2010 compared to both the same month last year and
February 2010. Inflation (YoY) in recreation & entertainment sub-group during
March 2010 remained unchanged, whereas in medicare sub-group increased
during the current month compared to February 2010 (see Figure A1 in
Annexure A).

Seggregated analysis of 250 commodities included in CPI non-food basket

revealed that prices of 5 commodities declined, 52 showed no change in their
prices, 62 commodities showed price change between 0 to 5 percent, 62 moved
between 5 to 10 percent and 69 commodities showed price change of more than 10
percent. The commodities which showed significant YoY price change included
English books class VI, Urdu books class V, polyfax ointment, petrol, diesel,
silver, and gold (see Table A2 & A4 in the Annexure).

9
Inflation Monitor, March 2010

2.3 City-wise Table 2.2: City-wise Inflation of Se le cte d Citie s percent

Inflation Mar-09 Fe b-10 Mar-10
City-wise data reveals MoM YoY MoM YoY MoM YoY
that inflation (YoY) in O ve r all CPI 1.4 19.1 0.4 13.0 1.3 12.9
the four out of five Islamabad 0.9 17.0 0.2 11.0 1.2 11.3
major cities was lower Lahore 1.3 17.5 0.7 13.1 1.7 13.6
than the overall CPI Karachi 1.1 19.4 0.6 12.2 1.4 12.6
YoY inflation during Quetta 1.2 22.5 0.7 11.0 1.6 11.4
March 2010. It is Peshawar 1.3 20.7 0.0 12.3 1.0 12.0
important to note that in contrast with the corresponding period last year, current
inflationary pressures are hitting larger urban centers (Lahore and Karachi). It
probably implies that present inflation is not a function of temporary supply
shock; and that inflationary pressures are likely to persist in the economy months
ahead. On month-on-month basis inflation in three out of five major cities was
higher than the overall CPI inflation (MoM) and the other two cities showed lower
inflation during March 2010 (see Table 2.1).
Table 2.3: City-wise Inflation in CPI (YoY) March 2010

High inflation cities Low inflation cities

General Food Non-food General Food Non-food
Bahawalnagar 17.2 19.9 15.1 Khuzdar 12.7 13.1 12.3
Bahawalpur 16.0 21.1 11.9 Karachi 12.6 14.8 10.9
Gujranwala 15.5 19.7 12.3 Loralai 12.5 12.4 12.7
Okara 15.2 18.9 12.4 Abbotabad 12.5 11.8 13.1
Jhang 15.0 18.9 12.0 Hyderabad 12.4 14.1 11.0
Sialkot 14.9 17.9 12.4 Mianwali 12.1 15.3 9.7
Vehari 14.6 18.1 11.8 Peshawar 12.0 11.8 12.2
T urbat 14.6 16.4 13.3 Kunri 11.8 14.4 9.8
Samundari 14.5 17.2 12.4 D.I.Khan 11.6 10.7 12.4
Faisalabad 14.3 18.6 10.8 Mirpur Khas 11.6 12.5 10.9
Sargodha 14.0 15.9 12.5 Quetta 11.4 11.0 11.8
Attock 13.8 15.4 12.6 Islamabad 11.3 13.5 9.7
Lahore 13.6 16.4 11.3 Mardan 10.5 10.5 10.5
Jhelum 13.4 17.3 10.5 Sukkur 9.9 8.0 11.5
D.G. Khan 13.3 13.9 12.9 Larkana 9.0 7.8 10.0
Nawabshah 13.1 13.7 12.6
Multan 13.1 15.4 11.2
Shahdadpur 13.1 13.2 13.0
Bannu 13.0 13.3 12.8
Rawalpindi 13.0 15.3 11.3
Note: High inflation refers to above average inflation, and low inflation refers to below average inflation

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 State Bank of Pakistan

The inflation data collected from 35 cities revealed that 20 cities recorded higher
inflation than the overall inflation (YoY), while 15 remaining cities registered
lower than average inflation during March 2010. Similar to the previous month,
the highest inflation (YoY) was recorded in Bahawalnagar, while Larkana
registered the lowest inflation (YoY). The highest food inflation was recorded in
Bahawalpur and the lowest in Sukkur during the month under review. While the
highest non-food inflation (YoY) was recorded in Bahawalnagar, the lowest non-
food inflation was observed in Islamabad and Mianwali (see Table 2.2). It is also
important to note that the variability in food inflation was significantly higher in
different cities of Pakistan compared with the non-food inflation.1

2.4 Income Group-wise Inflation

Income group-wise inflation (YoY) data indicates that all income groups, except
the highest income group, experienced higher than the average CPI and CPI food
inflation (YoY) during March 2010. However, incidence of non-food inflation
(YoY) was the highest for the highest income group (see Table 2.3).
Table 2.3: Income Group-wise CPI Inflation percent
Upto 3000 Rs. 3001-5000 Rs. 5000-12000 Above Rs. 12000
Mar-09 Mar-10 Mar-09 Mar-10 Mar-09 Mar-10 Mar-09 Mar-10
Year on Year (March over March)
General 19.4 13.8 19.6 13.6 19.9 13.1 18.0 12.5
CPI Food 20.7 16.0 20.2 15.6 20.0 14.9 19.2 13.6
CPI Non-food 17.8 11.1 18.9 11.3 19.9 11.4 17.3 11.9
Month on Month (March over February)
General 1.5 1.1 1.5 1.2 1.4 1.2 1.3 1.3
CPI Food 2.1 1.5 2.1 1.5 2.1 1.7 2.2 2.1
CPI Non-food 0.8 0.7 0.8 0.7 0.7 0.8 0.7 0.8

City and income group-wise data, collected from 17 cities, showed that the highest
inflation (YoY) was recorded in Bahawalpur for all income groups except higher
income group where Gujranwala hold this position. Larkana recorded the lowest
inflation (YoY) for all income groups except lower income group where Quetta
having lower inflation during March 2010 (see Table A5 in Annexure A).

1
Standard deviation of food inflation in different cities was 3.3 during March 2010 compared with
standard deviation of only 1.2 for non-food.

11
Inflation Monitor, March 2010

2.5 Services and Non-services Inflation

Inflation (YoY) in services remained same during March 2010 compared to the
previous month, however it was 8.3 percentage points lower, when compared to
the same month last year. Inflation in non-services sector declined during March
2010 compared to both the previous month and the corresponding month last year.
Inflation (YoY) in services sector was 12.2 percent compared to 20.5 percent in
the corresponding month last year. Inflation (YoY) in non-services sector was 13.4
percent in March 2010 compared to 13.6 percent in February 2010 and 18.1
percent in the same month last year (see Figure 2.11).

Figure 2.11: Services & Non-services Inflation Figure 2.12: Durables and Non-durables Inflation
(YoY) (YoY)
Services Non-services Overall CPI Durable Non-Durables Overall CPI
32 33
28 28
24 23
percent

20
percent

18
16
12 13
8 8
4 3
Mar-09
Mar-08

Mar-10
Sep-08

Sep-09

Jun-09
Jun-08
Jun-09
Jun-08

Dec-08

Dec-09
Dec-08

Dec-09

Mar-08

Mar-09

Mar-10
Sep-08

Sep-09

Further disaggregation of the non-services sector data reveals that YoY inflation in
durable dropped to 14.0 percent in March 2010 from 15.1 percent in February
2010 and 18.8 percent during March 2009. Inflation in non-durable items also
decreased to 13.4 percent during March 2010 from 13.6 percent in February 2010.
It was 18.0 percent in March 2009 (see Figure 2.12).

12
 State Bank of Pakistan

3. Wholesale Price Index

WPI inflation (YoY) crossed
the 20-percent level for the first Figure 3.1: WholesalePrice Inflation (percent)
time in 17 months, reaching YoY 12-mma MoM (rhs)
21.8 percent during March 40 5
35 4
2010. WPI inflation (MoM) 30 3
also showed a strong increase 2
25 1
of 2.5 percent during the month 20 0
15 -1
under review compared with -2
10
0.4 percent in the previous 5
-3
-4
month. 0 -5

Nov-08

Nov-09
May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Jul-08

Jul-09
Recent surge in WPI inflation
was largely due to external
factors. In particular, recent
rise in the prices of crude oil, cotton, and metals in international market has been
major driver of WPI inflation. Higher external demand of certain food items (e.g.
potatoes and onions) has also been the factor behind uptick in WPI inflation
(MoM).

As a consequence of the strength in YoY WPI inflation, its 12-month moving

average (12-mma) has bottomed out and now it is moving upward. WPI inflation
(12-mma) was recorded at 9.0 percent in March 2010 compared to 8.1 percent in
February 2010 (see Figure 3.1).

WPI food inflation (YoY) reached 16.3 percent compared to 15.4 percent during
the preceding month; however, it was still lower when compared to 19.5 percent
during March 2009. On MoM basis WPI food inflation increased significantly by
1.7 percent during the month under review compared to 0.5 percent during the last
month (see Figure 3.2).

WPI non-food inflation (YoY) increased to the highest level in 18 months as it

reached 26.5 percent during March 2010 compared to 22.6 percent in February
2010 and significantly higher than 4.8 percent WPI non-food inflation (YoY)
during the same month in 2009. On MoM basis, WPI non-food inflation was
recorded 3.2 percent during the review month compared to 0.2 percent in the
preceding month. A disaggregated analysis suggests that inflationary pressures
came from raw materials, followed by fuel lighting & lubricants and
manufacturer sub-groups. It is also important to note that the drag by a deflation
in building material sub-group is declining and this sub-group is likely to have
positive contribution in WPI inflation April 2010 onward (see Figure 3.3).

13
Inflation Monitor, March 2010

Figrure 3.2: WPI Food Inflatin (percent) Figure 3.3: WPI Non-food Inflation (percent)
YoY 12-mma MoM (rhs) YoY 12-mma MoM (rhs)
40 6 40 8
35 5 35 6
4 30 4
30 25
25 3 2
20
2 15 0
20
1 10
15 0
-2
5 -4
10 -1 0
5 -2 -5 -6
0 -3 -10 -8

Jun-08

Jun-09

Dec-09
Dec-08
Mar-08

Mar-10
Mar-09

Sep-09
Sep-08
Jun-08

Jun-09
Dec-08

Dec-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09

Raw materials sub-group witnessed highest inflation (YoY) since May 1994,
stood at 47.7 percent during the month under review compared to 34.7 percent in
the previous month and 16.5 percent during the corresponding month last year. On
MoM basis, inflation in this sub-group recorded at 9.7 percent compared to 6.4
percent during February 2010. A significant rise in inflation by raw material sub-
group is attributed to surge in the prices of cotton and sugarcane.

Inflation in fuel lighting & lubricants sub-group recorded rise of 32.9 percentage
points compared to the same month last year. Inflation (YoY) in the sub-group
during March 2010 was 33.3 percent against 30.8 percent in the previous month.
This was the highest inflation in this sub-group in 18 months. It came principally
due to upward adjustment in administered prices of key fuels following rise in
international crude oil prices (see Table A7).

In manufactures sub-group inflation (YoY) registered at 16.5 percent during

March 2010 compared with 15.1 percent in February 2010. This was also
significantly higher than 5.1 percent recorded during the same month last year.
However, inflation (MoM) in the sub-group eased slightly as it reached 1.5
percent during the review month compared to 1.7 percent during the preceding
month (see Table 3.1).

14
 State Bank of Pakistan

Table 3.1:WPI Non-Food Inflation (percent)

Fuel, Lighting Building
Raw Materials & Lubricants Manufactures Materials
YoY MoM YoY MoM YoY MoM YoY MoM
Mar-09 16.5 0.0 0.4 0.2 5.1 0.3 9.7 -2.0
Apr-09 18.4 3.0 -4.7 2.8 5.2 0.7 0.1 -1.8
May-09 18.7 3.3 -7.9 3.7 4.6 1.0 -6.6 -3.6
Jun-09 11.9 -0.5 -4.0 8.1 3.2 0.0 -10.1 0.3
Jul-09 8.3 -1.5 -11.8 -0.9 1.2 -0.1 -11.5 3.3
Aug-09 4.1 2.0 -10.0 3.0 -0.3 1.8 -13.3 -1.1
Sep-09 4.7 -1.0 -7.9 0.3 -0.5 0.6 -13.9 -2.1
Oct-09 12.1 0.8 4.7 2.8 0.2 0.7 -16.1 -2.3
Nov-09 20.2 5.8 26.9 3.7 7.4 3.6 -16.7 -1.5
Dec-09 33.7 8.4 25.5 -1.5 11.0 1.5 -12.4 -0.3
Jan-10 30.3 4.0 33.2 8.2 14.3 2.4 -3.7 5.1
Feb-10 34.7 6.4 30.8 -2.7 15.1 1.7 -4.2 2.1
Mar-10 47.7 9.7 33.3 2.2 16.5 1.5 -1.3 1.0

Detailed item-wise analysis of WPI basket shows that out of 106 items, 43 items
recorded double digit inflation (YoY); 24 were food items and others non-food
items.

On YoY basis, out of 43 food items in WPI basket, prices of only 4 items declined
during March 2010 compared to 9 items in the preceding month; 24 items
registered double digit inflation during the current month against 21 items in the
preceding month. These include pulses, meats, sugar, gur, wheat and wheat flour.
Prices of pulses increased as a result of rise in the prices in international market.

Within non-food category, 19 items registered double digit inflation during the
month under review. The rise in administered prices of key fuels, electricity
charges and cotton and cotton products were the major contributors in WPI
inflation (YoY) during the
month under review. The rise Figure 3.4: WPI Inflation in Cotton Pricces (percent)
in the prices of key fuels and YoY MoM (rhs)
cotton was mainly a function of 70 15
higher international prices, 50 10
whereas rise in electricity tariff 30
5
was a consequence of reduction 0
in its subsidy. 10
-5
-10 -10
Within Raw materials sub- -30 -15
group, cotton and sugarcane
May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Nov-08

Nov-09
Jul-08

Jul-09

prices rose sharply during

March 2010. Cotton prices

15
Inflation Monitor, March 2010

increased by 69.5 percent YoY Figure 3.5: WPI Inflation in Sugarcane Pricces (percent)
in March 2010 compared to
YoY MoM (rhs)
42.0 percent in February 2010 35
75
(see Figure 3.4). 28
55
21
Sugarcane prices witnessed 35
14
72.1 percent YoY rise during 15 7
the review month compared to -5 0
67.3 percent in the previous
-25 -7
month (see Figure 3.5). The

May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Nov-08

Nov-09
Jul-08

Jul-09
rise in domestic prices of these
commodities was principally a
reflection of increased
international prices amid global supply shortages.

4. Sensitive Price Indicator

SPI inflation increased a little Figure 4.1: Sensitive Price Indicator (SPI) (percent)
to 17.6 percent YoY in March YoY 12-mma MoM (rhs)
2010 from 17.2 percent during 35 6.0
February 2010, but was still 5.0
30
4.0
lower than 19.8 percent 25 3.0
recorded in March 2009. On 2.0
20
MoM basis SPI inflation also 1.0
15 0.0
increased to 1.1 percent during
-1.0
the month under review 10
-2.0
compared to a 0.9 percent rise 5 -3.0
Nov-08

Nov-09

during the previous month (see

May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Jul-08

Jul-09

Figure 4.1).

Income group-wise data of SPI inflation suggests that incidence of YoY inflation
was higher in low income groups. However, incidence of SPI inflation (MoM) is
mainly on higher income groups (see Table 4.1).

The cause of higher Table 4.1: Income Group-wise SPI Inflation (percent)
incidence of SPI Mar-09 Feb-10 Mar-10
inflation (YoY) in low YoY MoM YoY MoM YoY MoM
income group during Up to Rs. 3000 20.1 0.6 18.0 0.6 18.2 0.8
March 2010 was the Rs. 3001-5000 20.7 0.6 17.8 0.5 18.0 0.8
rise in the prices of Rs. 5000-12000 21.5 0.7 17.3 0.5 17.6 1.0
essential food items Above Rs. 12000 19.3 0.8 17.1 1.2 17.4 1.0
during the month. Out All income groups 19.8 0.8 17.2 0.9 17.6 1.1
of 28 items recording

16
 State Bank of Pakistan

double-digit inflation, 19 were food items. These include wheat (10.7 percent),
wheat flour (22.6 percent), sugar (48.4 percent), potatoes (49.7 percent), milk and
milk products, different types of pulses, etc. (see Table A8).

Weekly SPI inflation (YoY) increased from 17.0 percent in the first week of
March 2010 to 18.2 percent during the last week of the month. However, weekly
SPI inflation (WoW) was 0.4 percent during the first week of March 2010; it
increased to 0.5 percent during the third week of the month but ended at a
deflation of 0.2 percent during the last week of the month (see Figure 4.2 & 4.3).

Figure 4.2: Weekly SPI Inflation (WoW) Figure 4.3: Weekly SPI Inflation (YoY)
FY09 FY10 FY09 FY10
2.5 35
2.0
1.5 30
1.0 25
0.5
0.0 20
-0.5 15
-1.0
-1.5 10
-2.0 5
III-Nov

III-Dec
IV-Oct
I-Nov

I-Dec

V-Dec

II-Mar
IV-Mar

III-Nov
II-Feb

III-Dec
IV-Feb
II-Jan
IV-Jan

IV-Oct
I-Nov

I-Dec

V-Dec

II-Mar
IV-Mar
II-Feb
IV-Feb
II-Jan
IV-Jan

17
Inflation Monitor, March 2010

5 Global Commodity Prices

Overview
Commodity prices in international markets rose in March 2010 after dipping in
February 2010 on MoM basis. This recovery was led by large gains in the prices
of industrial metals, cotton, and crude oil. However, food commodity prices
declined consecutively for the second month.

In March 2010, the following developments remained dominant in the

international commodity Table 5.1 : Monthly Changes in Major Indices
markets: (a) Europe’s emergency MoM
aid plan of 30 billion euro for Mar-09 Jan-10 Feb-10 Mar-10
debt-stricken Greece; (b) Overall 2.9 3.5 -2.3 4.0
improved sentiments about Food 0.4 0.7 -0.9 -0.4
recovery in global economy as Metals 3.0 3.5 -5.6 7.1
IMF upward revised its forecast Energy 5.1 4.3 -2.9 5.0
of growth in world economy to Cotton -6.7 0.8 3.4 7.2
4.1 percent from January 2010 Fertilizers -2.1 4.8 2.0 0.5
forecast of 3.9 percent; and (c)
YoY
employment generation in US
Mar-09 Jan-10 Feb-10 Mar-10
during March 2010. Despite
Overall -45.2 41.1 44.4 45.9
these positive developments,
Food -25.9 11.4 12.9 12.0
expectations of China’s shift in
Metals -52 59.7 55.8 62
exchange rate policy and
Energy -50.3 51.2 56.0 55.9
concerns regarding the level of
Cotton -35.8 34.1 45.0 66.6
public debt in OECD countries
Fertilizers -26.8 -37.0 -28.9 -27.1
constrained a further rise in
Source : IMF (*) WB
commodity prices.

IMF commodity price index rose by 4.0 percent on MoM basis during March 2010
compared to a decline of 2.3 percent in February 2010. Similarly, on YoY basis
index increased by 45.9 percent in March 2010, from 44.4 percent during last
month and a decline of 45.2 percent witnessed during March 2009 (see Table 5.1).

18
 State Bank of Pakistan

Food Group
In contrast to overall situation, Table 5.2 : Monthly Changes in Food Indices
World Bank’s food index MoM
declined this month on MoM Mar-09 Jan-10 Feb-10 Mar-10
basis by 3.6 percent for the Overall food -0.4 1.4 -3.6 -3.6
second consecutive month. This
Edible Oils & Fats -2.8 -0.4 -3.0 -0.9
decline was also evident in all
Grains 0.8 -1.5 -4.5 -2.9
the sub-groups of food
Beverages # -3.8 0.1 -4.2 -3.3
commodities (see Table 5.2 &
Other Food* 1.7 6.9 -3.4 -7.9
5.3).
YoY
Mar-09 Jan-10
Feb-10 Mar-10
The following developments
Overall food -31.5 15.2 11.9 8.4
were the main drivers in food
Edible Oils & Fats -42.5 18.2 15.9 18.2
markets during March 2010: (a)
Grains -27.8 -5.1 -6.7 -10.1
ample supplies of grains and
Beverages # -13.3 26.4 20.4 21.0
positive outlook for upcoming
Other Food* -11.6 36.6 28.5 16.3
harvests due to favorable weather
Source : WB
and increased planting; (b) (*) includes sugar (#) consists of tea and coffee
arrival of South American
bumper soybean crop in the market created bearish trend in edible oils; (c)
increased tea production in Uganda, Africa’s third-largest producer of the leaf due
to increased planting and better farm management kept tea prices lower in the
international markets; and (d) higher sugar supplies from Brazil and India pressed
sugar prices downward by 25.4 percent in March 2010 (MoM) on top of a decline
of 8.5 percent in the previous
month. Figure 5.1: Monthly Changes in Crude oil
YoY Change MoM Change Price (RHS)
120 150
Non-food group 100 135
Among non-food group, crude 80
120
US$ per barrel

oil, industrial metals, and 60

40 105
cotton prices increased
percent

20 90
sharply during March 2010. 0 75
Whereas, fertilizers prices -20
60
-40
declined during the month on -60 45
MoM basis (see Figure 5.1 & -80 30
Table 5.3).
Nov-08

Nov-09
May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Jul-09
Jul-08

19
Inflation Monitor, March 2010

Crude oil prices in March Figure 5.4: Monthly Changes in Cotton 'A' Index
2010 rose to US$ 79.3 per YoY Change MoM Change
75
barrel, the highest level since 60
September 2008. Positive 45
macroeconomic developments 30

percent
such as (a) improved 15
manufacturing and services 0
sectors along with -15
employment creation in the -30
US, the largest consumer of -45
oil in the world; (b) weakness

Nov-08

Nov-09
May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Jul-09
Jul-08
in US dollar; and (c) Euro
30.0 billion debt relief plan of
Europe for Greece, supported Figure 5.2: Monthly Changes in Industrial Metal Index
the rise in crude oil prices. MoM change YoY change
80
Cotton prices increased 60
sharply during March 2010 40
due to renewed prospects for
percent

20
lower global production and
0
higher consumption. China,
-20
the largest cotton producer
-40
and consumer of the world,
announced during the first -60
Nov-08

Nov-09
May-08

May-09

Mar-10
Mar-08

Mar-09
Sep-08

Sep-09
Jan-09

Jan-10
Jul-08

Jul-09

week of March 2010 that its

2009 crop fell 14.6 percent
last year to 6.4 million tons.
Figure 5.3: Monthly Changes in Gold
Industrial metal prices also Price (RHS) YoY change
witnessed sharp rise in prices 60 1200
during March 2010,
45 1100
US$ per troy ounce

registering 12.7 percentage

point increase on MoM basis.
percent

30 1000
Metals prices also rose on
15 900
economic optimism based on
strong growth in China and 0 800
India coupled with
-15 700
encouraging news from
Nov-08

Nov-09
May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Jul-08

Jul-09

OECD countries led by US

and Japan. Revision in the
mechanism of customary

20
 State Bank of Pakistan

annual contract price of iron ore has also pushed up base metal prices in
international market.

Gold prices recovered this month after declining for the last two consecutive
months and reached US$ 1,113.3 from US$ 1,095.4 in February 2010. Zero to
negative real interest rates in major currencies, concerns over sovereign debt in
OECD countries, and expectation of rising inflation in US, pulled the gold prices
higher in the international market (see Annexure Table A12).

21
Inflation Monitor, March 2010

Annexure A

Table A1: CPI Inflation by Groups

MoM change YoY change
Weights Mar-09 Feb-10 Mar-10 Mar-09 Feb-10 Mar-10

I. Food Group 40.3 2.2 0.1 1.8 19.7 14.9 14.5

II. Non-Food Group 59.7 0.7 0.6 0.8 18.5 11.5 11.6
Apparel, textile, etc. 6.1 0.3 0.7 0.8 13.6 5.6 6.1
House rent 23.4 1.3 0.8 0.6 18.7 12.7 12.0
Fuel & lighting 7.3 0.0 -0.1 -0.1 26.7 17.2 17.1
Household furniture & equiptment 3.3 0.6 0.7 0.4 14.2 5.5 5.3
T ransport & communication 7.3 0.1 1.1 3.4 17.8 10.4 14.0
Recreation & entertainment 0.8 0.0 3.5 0.1 13.9 4.3 4.3
Education 3.5 0.5 0.2 0.2 18.4 12.9 12.5
Cleaning, laundry, etc. 5.9 1.3 0.5 0.3 16.4 9.8 8.6
Medicare 2.1 0.1 0.4 0.2 14.2 5.9 6.0
Headline 100 1.4 0.4 1.3 19.1 13.0 12.9

Table A2: Distribution of Price Changes of CPI Basket (YoY)

No. of Items in each Inflation Range
Total
Groups % Changes Number Decrease or no Subdued Moderate Double digit
of Items change increase increase increase
(0 % or less) (0 to 5%) (5 to 10%) (over 10%)
Mar-09 Mar-10 Mar-10 Mar-09 Mar-10 Mar-09 Mar-10 Mar-09 Mar-10 Mar-09 Mar-10
I. Food Group 19.7 14.5 107 17 12 5 23 11 15 74 57
II. Non-Food Group 18.5 11.6 250 29 5 19 114 33 62 169 69
Apparel, textile, etc. 13.6 6.1 42 1 0 0 14 13 21 28 7
House rent 18.7 12.0 1 0 0 0 0 0 0 1 1
Fuel & lighting 26.7 17.1 15 3 0 0 1 1 0 11 14
Household furniture & equipt 14.2 5.3 44 0 1 1 20 6 18 37 5
Transport & communication 17.8 14.0 43 5 3 1 21 1 8 36 11
Recreation & entertainment 13.9 4.3 16 1 0 7 12 2 0 6 4
Education 18.4 12.5 24 3 0 3 8 1 4 17 12
Cleaning, laundry, etc. 16.4 8.6 36 3 0 3 17 6 10 24 9
Medicines 14.2 6.0 29 13 1 4 21 3 1 9 6
O verall 19.1 12.9 357
Note: Prices of 17 seasonal items were not reported during the month.

22
 State Bank of Pakistan

Table A3: Top Ten Contribution to YoY CPI Inflation in March 2010
YoY change Weighted
Items Weights Mar-09 Mar-10 Contribution
A. Ranked by Weighted Contribution
1 House Rent Index 23.43 18.69 12.00 21.00
2 Wheat Flour 5.11 45.93 18.61 9.8
3 Milk Fresh 6.66 17.96 15.33 8.69
4 Meat 2.70 16.16 22.62 6.40
5 Sugar 1.95 71.58 49.57 6.10
6 Electricity 4.37 25.58 18.63 5.18
7 Vegetables 1.76 -23.89 33.73 4.42
8 Natural Gas 2.05 27.74 17.34 4.00
9 Petrol 1.73 -7.69 26.70 3.48
10 Vegetable Ghee 2.67 -18.38 13.24 3.03
Total 52.42 72.11

B. Ranked by Percentage Change

1 Pulse Moong 0.22 -8.97 86.05 1.21
2 Pulse Mash 0.20 6.27 78.30 1.05
3 Gur 0.07 55.02 56.89 0.30
4 Potatoes 0.61 8.16 52.76 1.63
5 Sugar 1.95 71.58 49.57 6.10
6 Vegetables 1.76 -23.89 33.73 4.42
7 T ext Books 0.69 31.05 29.17 1.34
8 Jewellery 0.39 15.76 28.98 1.48
9 Diesel 0.21 29.88 28.78 0.86
10 T ea 1.26 36.89 28.19 2.26
Total 7.36 20.64

C. Ranked by Weights
1 House Rent Index 23.43 18.69 12.00 21.00
2 Milk Fresh 6.66 17.96 15.33 8.69
3 Wheat Flour 5.11 45.93 18.61 9.82
4 Electricity 4.37 25.58 18.63 5.18
5 Bakery & Confectionary 2.98 12.12 4.55 0.78
6 Meat 2.70 16.16 22.62 6.40
7 Vegetable Ghee 2.67 -18.38 13.24 3.03
8 T ution Fees 2.36 13.86 8.78 1.37
9 T ransport Fare/Charges 2.12 41.19 12.56 2.68
10 Natural Gas 2.05 27.74 17.34 4.00
Total 54.45 62.94
Note: Weighted contribution is estimated by multiplying the weights by the price change of an item;
this is then reported as a share in YoY change in CPI, which is 12.9 percent in March 2010.

23
Inflation Monitor, March 2010

Table A4: Distribution of Price Changes (YoY)- Selected CPI Items, March 2010

Decrease or no Subdued increase Moderate increase Increase of over

Groups change (upto 5%) (5 to 10%) 10%
Fruit Juice Tetra Pack Milk Fresh
Milk Powder Wheat Flour (Unboiled)
Loose/Packed Fine/Superior. Wheat Flour Bag
Onion Cooking Oil (Dalda) Vegetable Ghee Tin Sugar Refined
Cocumber (Kheera) Rice Basmati Broken Bread Tandoori St. Beef With Bone
Rice Basmati 385/386 Av.Qlty,Pulse Gram Size, Bananas Av.Qlty., Vegetable
Food Group
Chillies Eggs Farm Bread Plain Medium Ghee (Loose)
Powd.National Rice Basmati Sup. Size, Cold Drink Mutton Av.Qlty.
200Gm, Kinnu, Qlty. (Standard Siz) Chicken Farm
Guava Pulse Masoor Betel Leaves, Milk Broiler (Live),
Malta/Mosambi, Peas (Washed) Tetra Pack 1/2 Ltr. Potatoes,Tea Loose
Chillies Green Biscuits-Packed Cabbage Kenya Av.Qlty 250G
Ladies Spoung Lawn Av.Qlty. Tailoring Suit
Apparel & Chappal Bata, Gents Long Cloth Av.Qlty. School Uni. Kameez, Female, Tailoring
Textile Shoes Paul Bata, Shirting Av.Qlty. Shal.Girl, Tailoring Shirt, Tailoring
Gents Sandal Bata Ladies Sandal Bata Coat-Pant Suit Awami-Suit (Male)
House Rent
House Rent Index
Index
Elect.Charges Above
1000 units, Gas Chrg
6.7438 - 10.1157
Fuel & Lighting -- --
mmb, Kerosene Oil
Match Box Small Bulb Philips 100-
Watts
Household Servant Chair Shesham
Household Quilt (Lihaf) 3 Kg. Female, Tea Set Pak. Wood With Arms
Furniture & Cotton, Blanket (90" X Chinaware 21 Pc Hand Stitching
Equipment Washing Machine 54"), Celing Fan 48" Bedsheet Single Bed Needle M.Siz
Singer Super Qlty Sup.Qlty Presure Cooker 4 Ltr.
Car Suzuki 800 cc Petrol Super
(w/o. A/C), Car Tax Internet Charges Car Service Charges High Speed Diesel
Transport & For 800cc To 1300cc Bus Fare Outside City Tyre Car With Tube HSD, Cng Filling
Communication. Air Fare Economy A/C Bus Fare Outside General Charges
Class., Plateform City, Car Service Auto Rickshaw Fares Bus Fare Min
Ticket Charges Taxi 4 Seater Fare (Within City)
Daily "Dawn" T.V. 20" Colored Daily "Jang"
Recreation & Monthly "Naunehal Video Game Sega 16 Daily "Nawa-E-
--
Entertainment Digest", Tv.Licence Byte, Cinema A/C. Waqt", Weekly
Feedomestic Highest Class "Akhbar-E-Jahan"
School Fee Primary
Govt. College Fee Ist. Paper Foolscape Govt. Med. College Eng.Med.
Year, Govt. College (27"X17"), Comp. Fee MBBS, Exercise. Maths Book Class Ix
Education
Fee 4Th. Year With Printer & Book Lined 80/100 P Or X
Com. C.D. Speaker, Ball Pen Fountin Pen Youth Eng. Book Ist.Yr
(TDK/Imation) (Local) China Complete Se
Washing Soap
Toilet Soap Lux 95 Talc Powder Vice Nyl(135-160gams)
Cleaning & grams, Surf (Medium) Roay,B.Cat Hair-Oil, Amla/ Haircut Charges For
Laundry 160 grams, Washing Facecream Ponds Chambeli, Dry Men, Gold Tezabi 24
Powder 1000 grams (Medium), Blade 7-O- Cleaning Suit Coat ct, Artificial
Toilet Soap Lifebouy Clock Stain. 5'S, Hair- Pant, Cleanser Powder Jewellary Set
140 grams Colour Begin (6 gms) Vim 1000 gm Silver Tezabi 24 ct
Gripe-Water
Woodwards
Medicare Dettol (Medium) O.R.S. (Nimcol) Galxos-D (450 grms)
Jouhar Joshanda Cotton Bandage 2" - Doctor (MBBS) Clinic Sancos Syrup (50
Cac. 1000 Tab 4",Daonil Tab. 5 mg. Fee ml.)

24
 State Bank of Pakistan

Table A5: City-wise Inflation by Income Groups, March 2010

Upto Rs:3000 Rs 3001-5000
General Food Non-Food General Food Non-Food
MoM YoY MoM YoY MoM YoY MoM YoY MoM YoY MoM YoY
1 Lahore 1.4 13.6 1.2 16.7 1.8 9.6 1.6 14.4 1.5 17.7 1.8 10.5
2 Faisalabad 1.2 15.0 1.8 20.1 0.5 8.4 1.2 15.5 1.7 20.7 0.7 9.5
3 Rawalpindi 1.0 13.5 1.6 16.1 0.2 10.1 1.1 13.9 1.9 16.8 0.1 10.5
4 Multan 1.0 13.9 1.2 16.6 0.9 10.5 1.1 13.9 1.2 16.5 1.0 10.7
5 Gujranwala 1.7 16.0 2.0 20.6 1.3 10.3 1.8 16.1 2.2 20.0 1.3 11.6
6 Islamabad 0.9 11.5 1.6 14.1 0.1 8.6 1.2 12.3 2.1 15.7 0.1 8.6
7 Sargodha 1.5 15.4 2.3 18.1 0.4 12.0 1.5 14.8 2.3 17.3 0.4 11.9
8 Sialkot 1.6 15.4 2.2 18.0 0.8 11.9 1.5 16.2 2.2 19.9 0.6 11.8
9 Bahawalpur 1.1 18.7 1.4 24.4 0.7 11.6 0.9 17.9 1.0 23.2 0.6 11.7
10 Karachi 1.6 13.8 2.5 15.8 0.4 11.1 1.6 13.9 2.8 16.5 0.2 10.9
11 Hyderabad 1.8 13.3 2.9 15.7 0.3 10.2 1.8 12.8 3.1 14.9 0.3 10.3
12 Sukkur 0.9 9.6 1.4 6.4 0.3 13.8 1.0 9.8 1.6 7.9 0.4 12.1
13 Larkana 0.7 10.7 0.8 9.6 0.6 12.3 0.7 9.6 0.8 8.9 0.6 10.4
14 Peshawar 0.5 13.0 0.3 14.1 0.7 11.5 0.5 12.5 0.3 12.9 0.7 12.1
15 Bannu 0.2 15.1 0.0 17.1 0.3 12.7 0.1 14.0 0.0 15.2 0.2 12.7
16 Quetta 1.5 9.3 2.3 8.9 0.4 9.9 1.5 11.7 2.2 11.9 0.6 11.4
17 Khuzdar 0.5 11.8 0.7 12.5 0.2 11.0 0.5 13.2 0.7 13.7 0.2 12.6
Rs 5001-12000 above Rs 12000
General Food Non-Food General Food Non-Food
MoM YoY MoM YoY MoM YoY MoM YoY MoM YoY MoM YoY
1 Lahore 1.7 13.9 1.8 17.0 1.6 10.8 1.7 13.2 2.7 15.4 1.1 11.9
2 Faisalabad 1.2 15.0 1.7 20.0 0.7 10.2 1.3 13.5 2.0 16.8 0.9 11.4
3 Rawalpindi 1.2 13.2 2.1 15.9 0.2 10.6 1.4 12.7 2.9 14.2 0.6 11.9
4 Multan 1.1 13.3 1.3 15.8 0.9 10.7 1.1 12.4 1.6 13.8 0.9 11.5
5 Gujranwala 1.8 15.5 2.4 19.6 1.1 11.7 2.0 15.0 3.4 19.5 1.2 12.4
6 Islamabad 1.1 12.1 2.4 15.2 -0.2 9.2 1.2 11.2 2.9 13.0 0.2 10.2
7 Sargodha 1.7 14.3 2.7 16.2 0.6 12.4 1.8 12.9 3.0 14.1 1.1 12.2
8 Sialkot 1.7 15.5 2.6 18.8 0.7 12.2 1.7 14.4 2.8 17.1 0.9 12.7
9 Bahawalpur 1.0 16.2 1.2 21.0 0.6 11.3 1.4 13.9 2.1 18.2 0.9 11.2
10 Karachi 1.5 13.2 2.7 15.7 0.3 10.7 1.3 12.1 2.7 13.4 0.5 11.3
11 Hyderabad 1.7 12.5 3.1 14.4 0.4 10.6 1.7 12.0 3.1 12.9 0.8 11.5
12 Sukkur 0.9 10.0 1.5 8.2 0.4 11.8 0.9 9.8 1.4 7.6 0.6 11.1
13 Larkana 0.7 9.0 0.7 7.7 0.6 10.4 0.6 8.4 0.6 7.2 0.6 9.2
14 Peshawar 0.8 12.0 0.8 12.1 0.8 11.9 1.3 11.9 1.8 11.2 1.0 12.4
15 Bannu 0.0 13.0 0.0 13.4 0.1 12.6 0.1 11.9 0.0 10.8 0.1 12.5
16 Quetta 1.5 11.3 2.4 11.2 0.5 11.4 1.7 11.6 2.7 10.7 1.1 12.1
17 Khuzdar 0.4 12.8 0.6 13.1 0.2 12.5 0.2 13.3 0.0 13.5 0.4 13.2

25
Inflation Monitor, March 2010

Table A6 : Income Group-wise Inflation percent

MoM YoY
Mar-09 Fe b-10 Mar-10 Mar-09 Fe b-10 Mar-10
Up to Rs. 3000
General 1.5 0.5 1.1 19.4 14.3 13.8
Food 2.1 0.3 1.5 20.7 16.8 16.0
Non-food 0.8 0.7 0.7 17.8 11.2 11.1
Rs. 3001-5000
General 1.5 0.4 1.2 19.6 14.0 13.6
Food 2.1 0.2 1.5 20.2 16.3 15.6
Non-food 0.8 0.7 0.7 18.9 11.4 11.3
Rs. 5000-12000
General 1.4 0.4 1.2 19.9 13.3 13.1
Food 2.1 0.1 1.7 20.0 15.4 14.9
Non-food 0.7 0.7 0.8 19.9 11.3 11.4
Above Rs. 12000
General 1.3 0.3 1.3 18.0 12.5 12.5
Food 2.2 0.0 2.1 19.2 13.8 13.6
Non-food 0.7 0.5 0.8 17.3 11.8 11.9
All income groups
General 1.4 0.4 1.3 19.1 13.0 12.9
Food 2.2 0.1 1.8 19.7 14.9 14.5
Non-food 0.7 0.6 0.8 18.5 11.5 11.6

26
 State Bank of Pakistan

Table A7: Distribution of Price Change (YoY) - WPI Items: March 2010
Decrease or Subdued increase Moderate increase More than 10%
Groups no change (upto 5%) (5 to 10%) increase
Oil Cakes
Maize, Beans
Cotton Seed Oil
Powdered Milk Vegetables Prepared
Sugar /Preserved, Fresh
Confectionary Milk, Wheat
Mustard & Dry Fruits, Fruit
Food

Rapeseed Oil Prepared/Preserved

Condiments Spices, Chicken
Rice Vegetable Ghee
Beverages Wheat Flour, Meat,
Mineral Water Fish, Tea, Jowar,
Tomatoes Maida Cooking Oil Gram Whole, Sugar
Onions Milk Food Gram Split Refined, Vegetables,
Masoor Eggs Salt Gur, Potatoes, Mash
Bajra Besan Fresh Fruits Moong
Cotton Seeds
material
Raw

Hides Tobacco
Skins Wool Cotton
Pig Iron Mustard/Rapeseeds Sugar Cane
Fuel & lighting

Natural Gas, Elec.

Agriculture Tariff-D
Electricity Ind. Supply
Tariff-B, Kerosine Oil
Coke Motor Sprit, Diesel Oil
Coal Mobil Oil Fire Wood Furnace Oil
Cosmetics
Mattresses
Tubes, Audio- Cotton Textiles
Visual Instruments Other Electrical
Manufactures

Dying Materials Goods, Plastic

Utensils, Machinery Products, Jute
Soaps, Fertilizers Manufactures Drugs & Medicines
Hosiery, Sole Pesticides & Cigarettes, Nylon Yarn
Leather, Ready Insecticised Glass Products
Tyres Made Garments Foot Wear Chemicals
Paper Transports, Silk & Woolen Textiles Blended Yarn
Matches Reyon Textiles Chrome Leather Cotton Yarn
Tiles
Cement Blocks
Building
material

Iron Bars & Sheets

Timber Wires And Cables
Paints & Varnishes Glass Sheets
Cement Pipe Fittings Bricks Sanitary Wares

27
Inflation Monitor, March 2010

Table A8: SPI Ite m-wise Price Move me nts

Price Pe rce ntage change
S.No Ite ms Unit Mar 10 YoY Monthly
1 Wheat Kg. 26.9 10.7 -0.4
2 Wheat flour average qlt. Kg. 30.0 22.6 -0.3
3 Rice basmti.broken Kg. 43.9 1.2 0.7
4 Rice irri-6 Kg. 34.7 -3.6 1.0
5 Masur pulse washed Kg. 122.9 3.2 -0.6
6 Moong pulse washed Kg. 88.1 88.7 4.0
7 Mash pulse washed Kg. 135.0 78.4 0.9
8 Gram pulse washed Kg. 56.3 6.6 -0.4
9 Beef Kg. 180.3 22.8 2.5
10 Mutton Kg. 331.9 24.0 4.7
11 Egg hen (farm) Doz. 60.6 2.6 -6.7
12 Bread plain Each 27.3 8.3 1.4
13 Sugar Kg. 64.9 48.4 -4.6
14 Gur Kg. 72.4 55.5 -1.9
15 Milk fresh Ltr 42.6 16.0 2.1
16 Milk powdered nido 400g 180.0 5.9 0.0
17 Curd Kg. 50.4 16.4 2.6
18 Veg.ghee tin 2.5kg 353.0 8.1 0.0
19 Veg.ghee loose Kg. 115.8 18.6 0.9
20 Mustard oil Kg. 135.9 -2.1 -0.6
21 Cooking oil 2.5ltr 353.0 0.5 0.0
22 Potatoes Kg. 18.0 49.7 7.7
23 Onions Kg. 25.5 -36.0 6.5
24 T omatoes Kg. 19.1 -33.0 4.1
25 Bananas Doz. 41.1 6.7 5.7
26 Salt powdered Kg. 6.7 5.3 0.6
27 Red chillies(powd) Kg. 165.7 25.5 0.3
28 Garlic Kg. 149.5 275.5 2.3
29 T ea packet 250g 130.3 30.3 1.3
30 T ea (prepared) Cup 10.7 22.1 0.2
31 Cooked beef plate Each 45.6 10.3 0.6
32 Cooked dal plate Each 28.9 11.0 0.5
33 Cigarettes k-2 10's 12.9 35.9 7.3
34 Coarse latha Mtr. 48.7 7.8 3.3
35 Lawn (avg.+s.qlty) Mtr. 96.8 7.4 4.0
36 Voil printed Mtr. 49.1 6.2 3.0
37 Shirting Mtr. 82.3 3.7 -0.1
38 Sandel gents bata Pair 499.0 0.0 0.0
39 Sandel ladies bata Pair 379.0 0.0 0.0
40 Chappal spng. Bata Pair 129.0 0.0 0.0
41 Kerosene Litr 73.2 15.6 -3.0
42 Firewood 40kg 307.7 13.3 1.0
43 Elec. Bulb 60-wats Each 20.0 29.1 0.0
44 Match box Each 1.0 0.0 0.0
45 Washing soap Cake 13.2 4.4 0.4
46 Bath soap lifebuoy Cake 22.0 0.0 0.0
47 Chicken (farm) Kg. 141.3 18.0 13.6
48 Gas chrg. All clb. Comb mmbtu 337.2 15.4 0.0
49 L.P.G .(cylender 11kg.) Each 979.0 27.4 -7.8
50 Elec.chrg.all slabs comb per unit 8.1 19.3 0.0
51 Petrol Ltr 71.3 22.3 -1.0
52 Diesel Ltr 70.7 22.5 -2.5
53 T elephone local Call 2.4 0.0 0.0
Maximum 275.5 13.6
Me dian 10.7 0.3
Minimum -36.0 -7.8

28
 State Bank of Pakistan

Tabl e A9: C on su m e r Pri ce In de x Nu m be rs by Major Grou ps an d S e l e cte d C om m odi ti e s

In de x
Ite m an d S pe ci fi cati on
W e i gh ts Mar-09 Fe b-10 Mar-10
GENERAL 100.0005 194.53 216.93 219.65
FO O D & BEVERAGES . 40.3411 216.13 243.17 247.55
1 WHEAT 0.4830 281.84 315.30 316.44
2 WHEAT FLOUR 5.1122 259.35 307.37 307.61
3 MAIDA 0.1059 264.02 285.46 284.42
4 BESAN 0.1320 199.39 199.32 202.42
5 RICE 1.3369 279.14 276.37 278.24
6 P ULSE MASOOR 0.2214 328.50 344.67 342.19
7 P ULSE MOONG 0.2230 157.85 281.79 293.68
8 P ULSE MASH 0.2017 166.39 296.38 296.68
9 P ULSE GRAM 0.4272 186.99 193.66 194.92
10 GRAM WHOLE 0.1491 179.61 213.82 215.63
11 MUST ARD OIL 0.0456 248.90 251.97 251.54
12 COOKING OIL 0.6858 220.31 221.73 221.73
13 VEGET ABLE GHEE 2.6672 215.55 243.23 244.09
14 SUGAR 1.9467 158.73 248.00 237.42
15 GUR 0.0735 178.64 285.99 280.27
16 T EA 1.2559 160.35 204.99 205.56
17 MILK FRESH 6.6615 213.66 241.80 246.42
18 MILK P OWDER 0.1105 204.52 210.86 211.95
19 MILK P RODUCT S 0.5607 196.93 223.20 228.91
20 HONEY 0.0358 187.99 212.57 212.85
21 CEREALS 0.0878 229.27 250.46 254.44
22 JAM,T OMAT O,P ICKLES & VINEGAR 0.2472 165.53 184.43 184.51
23 BEVERAGES 0.7286 163.15 175.93 177.63
24 CONDIMENT S 0.3392 241.57 247.29 247.61
25 SP ICES 0.6008 210.22 232.96 234.17
26 DRY FRUIT 0.2760 311.88 338.88 342.50
27 BAKERY & CONFECT IONARY 2.9837 143.89 150.00 150.43
28 CIGARET T ES 0.9527 185.95 220.08 226.38
29 BET EL LEAVES & NUT S 0.1851 171.75 179.96 185.20
30 READYMADE FOOD 1.6833 223.16 249.65 253.48
31 SWEET MEAT & NIMCO 0.3846 226.13 256.97 260.82
32 FISH 0.2703 184.05 209.32 214.58
33 MEAT 2.6981 263.43 310.90 323.01
34 CHICKEN FARM 0.9158 228.66 234.92 269.84
35 EGGS 0.4119 222.38 236.66 228.70
36 P OT AT OES 0.6056 128.09 175.03 195.67
37 ONIONS 0.6487 415.40 224.98 242.15
38 T OMAT OES 0.5083 167.20 107.48 98.88
39 VEGET ABLES 1.7623 186.76 234.27 249.76
40 FRESH FRUIT S 1.6155 222.57 218.97 235.29
APPAREL, TEXTILE & FO O TW EAR. 6.0977 154.41 162.53 163.88
41 COT T ON CLOT H 1.6197 156.92 162.45 165.37
42 SILK,LINEN,WOOLEN/CLOT H 0.5766 152.77 166.20 168.07
43 T AILORING CHARGES 0.8636 161.95 178.40 179.56
44 HOSIERY 0.1528 165.31 177.68 179.06
45 READYMADE GARMENT S 1.2038 141.44 149.70 150.57
46 WOOLEN READYMADE GARMENT S 0.1485 177.91 200.00 200.40
47 FOOT WEAR 1.5327 154.95 157.23 157.28
HO US E RENT. 23.4298 187.57 208.78 210.08
48 HOUSE RENT INDEX (Combined) 23.4298 187.57 208.78 210.08
(continued)

29
Inflation Monitor, March 2010

(continued)
Tabl e A9: C onsume r Pri ce Inde x Numbe rs by Major Groups and Se l e cte d C ommodi ti e s
Inde x
Ite m and Spe ci fi cati on
W e i ghts Mar-09 Fe b-10 Mar-10
FUEL AND LIGHTING. 7.2912 208.15 243.96 243.82
49 KEROSENE 0.1366 389.17 441.51 461.64
50 FIREWOOD 0.4778 306.61 341.08 342.24
51 MAT CH BOX 0.1301 200.00 200.00 200.00
52 BULB & T UBE 0.1311 111.44 130.43 131.43
53 ELECT RICIT Y 4.3698 159.77 189.54 189.54
54 NAT URAL GAS 2.0458 283.12 334.40 332.21
H.HO LD.FURNITURE & EQ UIPMENT ETC . 3.2862 163.16 171.14 171.82
55 UT ENSILS 0.3690 149.57 157.83 158.05
56 PLAST IC PRODUCT S 0.1055 191.66 207.49 209.48
57 SUIT CASE 0.0470 157.02 165.11 166.17
58 HOUSE HOLD EQUIPMENT S 0.0953 149.00 158.24 160.02
59 FURNIT URE (Ready Made) 0.3054 174.46 185.99 186.87
60 FURNISHING 0.6362 155.44 162.68 163.55
61 ELECT .IRON FANS & WASHING MACHINE 0.1889 165.06 162.84 163.31
62 SEWING MACHINE,CLOCK AND NEEDLES 0.1270 141.57 150.39 150.71
63 REFRIGERAT OR & AIRCONDIT IONER 0.1756 129.44 132.57 133.54
64 MARRIAGE HALL 0.0445 188.76 202.70 203.60
65 HOUSE HOLD SERVANT 1.1918 173.45 182.04 182.54
TRANSPO RT & C O MMUNIC ATIO N. 7.3222 186.23 205.36 212.24
66 PET ROL 1.7253 189.71 232.19 240.37
67 DIESEL 0.2070 362.66 445.07 467.05
68 CNG. FILLING CHARGES 0.1649 205.46 226.80 226.80
69 SERVICE CHARGES 0.3835 165.53 175.46 177.47
70 VEHICLES 0.2596 134.55 133.71 134.13
71 T YRE & T UBE 0.2831 158.81 164.22 167.08
72 T RANSPORT FARE/CHARGES 2.1236 252.45 270.00 284.15
73 T RAIN FARE 0.1514 253.24 253.24 253.24
74 AIR FARE 0.0983 342.93 342.93 342.93
75 COMMUNICAT ION 1.9255 91.34 93.29 93.28
REC REATIO N & ENTERTAINMENT. 0.8259 121.30 126.43 126.54
76 RECREAT ION 0.3399 131.89 142.98 142.98
77 ENT ERT AINMENT 0.4860 113.89 114.86 115.04
EDUC ATIO N. 3.4548 165.58 185.97 186.28
78 T UT ION FEES 2.3629 165.76 180.15 180.31
79 ST AT IONERY 0.3500 172.91 180.74 182.69
80 T EXT BOOKS 0.6894 167.42 216.25 216.25
81 COMPUT ER & ALLIED PRODUCT S 0.0525 84.38 85.14 85.71
C LEANING LAUNDRY & PER.APPEARANC E. 5.8788 169.61 183.71 184.18
82 WASHING SOAP & DET ERGENT 1.5535 163.07 168.30 168.74
83 T OILET SOAP 0.7436 186.50 186.50 186.50
84 T OOT H PAST E 0.4036 113.55 116.80 117.62
85 SHAVING ART ICLES 0.3480 148.07 153.39 153.39
86 COSMET ICS 1.4272 154.37 167.87 168.16
87 WAT CHES 0.0552 138.95 139.13 139.31
88 JEWELLERY 0.3936 326.83 420.58 421.54
89 LAUNDRY CHARGES 0.2207 179.11 193.38 193.38
90 HAIR CUT & BEAUT Y PARLOUR CHARGES 0.7334 152.13 168.86 170.14
MEDIC ARE. 2.0728 150.09 158.79 159.10
91 DRUGS & MEDICARES 1.0752 118.04 125.68 126.27
92 DOCT OR'S FEE 0.9976 184.63 194.49 194.49

30
 State Bank of Pakistan

Table A10: Whole sale Price Inde x Numbe rs by major Groups and Se le cte d Commoditie s
Inde x
Ite m and Spe cifications Mar-09 Jul-09 Fe b-10 Mar-10
GENERAL 195.00 207.57 231.64 237.51
FO O D 212.16 224.31 242.67 246.68
1 WHEAT 282.04 283.44 319.65 319.74
2 WHEAT FLOUR 248.49 279.01 301.86 302.29
3 MAIDA 277.88 287.10 291.04 287.38
4 BESAN 170.58 161.96 173.78 178.62
5 RICE 317.60 323.02 319.18 325.33
6 MAIZE 226.03 214.54 231.67 252.50
7 JOWAR 205.01 219.78 240.32 258.70
8 BAJRA 206.35 187.99 194.47 200.25
9 BEANS 251.91 252.23 271.85 282.30
10 GRAM WHOLE 173.46 183.46 232.17 235.57
11 GRAM SPLIT 160.97 145.94 167.25 170.78
12 MASOOR 339.35 343.78 338.33 328.17
13 MASH 152.80 200.55 261.27 262.29
14 MOONG 156.39 181.22 278.82 297.38
15 POT AT OES 114.31 270.20 177.27 194.12
16 ONIONS 429.50 249.14 230.27 245.58
17 T OMAT OES 165.92 247.58 93.26 89.40
18 VEGET ABLES 170.57 217.26 238.65 253.21
19 FRESH FRUIT S 162.31 170.96 164.37 176.86
20 DRY FRUIT S 223.89 227.90 255.78 259.87
21 FRESH MILK 187.42 193.35 208.03 211.26
22 POWDERED MILK 222.65 221.71 222.47 222.89
23 MILK FOOD 165.61 168.67 171.18 171.71
24 VEGET ABLE GHEE 226.85 248.75 268.02 272.67
25 MUST ARD & RAPESEED OIL 278.28 262.37 280.70 280.01
26 COT T ON SEED OIL 253.60 260.39 284.31 285.06
27 COOKING OIL 212.38 218.95 221.17 224.44
28 OIL CAKES 286.09 335.07 317.15 318.48
29 GUR 157.83 223.82 259.85 264.19
30 SUGAR REFINED 162.77 170.10 250.56 237.71
31 CHICKEN 226.56 213.37 239.63 271.91
32 EGGS 231.02 225.69 243.31 241.19
33 FISH 119.29 124.68 142.98 146.82
34 MEAT 249.28 266.65 291.41 304.27
35 SPICES 206.74 198.13 244.16 247.58
36 CONDIMENT S 285.70 285.60 292.26 292.28
37 SALT 155.63 166.45 165.72 167.69
38 T EA 136.85 142.99 169.07 170.12
39 BEVERAGES 139.15 140.72 141.85 143.10
40 MINERAL WAT ER 123.39 125.71 127.38 127.38
41 FRUIT PREPARED/PRESERVED 158.26 166.76 178.61 187.12
42 VEGET ABLES PREPARED/PRESERVED 160.42 167.87 179.63 180.65
43 SUGAR CONFECT IONARY 99.95 100.48 100.46 100.46
RAW MATERIAL 185.99 193.88 250.35 274.70
44 COT T ON 142.34 148.77 210.85 241.21
45 COT T ON SEEDS 239.02 272.67 275.04 272.54
46 MUST ARD/RAPESEEDS 283.66 274.21 293.98 294.13
47 T OBACCO 198.80 204.91 221.77 228.26
48 SUGAR CANE 287.77 280.70 438.72 495.33
49 WOOL 138.51 139.48 141.45 142.92
50 HIDES 155.71 138.51 128.58 132.74
51 SKINS 107.92 105.26 98.99 102.05
52 PIG IRON 324.02 324.02 321.93 321.93
(continued)

31
Inflation Monitor, March 2010

(continued)
Table A10: W hole sale Price Inde x Numbe rs by major Groups and Se le cte d C ommoditie s
Inde x
Ite m and Spe cifications Mar-09 Jul-09 Fe b-10 Mar-10
FUEL & LIGHT 234.15 267.47 304.47 312.23
53 COAL 141.00 141.00 141.00 141.00
54 COKE 624.58 624.58 555.18 555.18
55 DIESEL OIL 353.27 385.74 434.92 455.42
56 MOT OR SPRIT 188.00 196.90 229.87 238.25
57 MOBIL OIL 197.40 199.47 200.36 200.36
58 FURNACE OIL 194.65 312.14 363.06 374.20
59 KEROSINE OIL 352.86 392.99 417.41 439.93
60 NAT URAL GAS 227.25 217.12 256.00 256.00
61 ELECT RICIT Y IND. SUPPLY T ARIFF-B 162.36 162.36 201.01 201.01
62 ELEC. AGRICULT URE T ARIFF-D 177.78 177.78 205.07 205.07
63 FIRE WOOD 254.98 260.16 279.48 279.48
MANUFAC TURE 138.81 141.07 159.31 161.77
64 SOLE LEAT HER 130.34 131.99 134.06 134.06
65 CHROME LEAT HER 194.84 194.84 212.23 212.23
66 COT T ON YARN 97.65 102.08 150.55 155.72
67 BLENDED YARN 127.10 131.60 173.90 177.53
68 NYLON YARN 105.61 109.59 121.04 121.72
69 COT T ON T EXT ILES 142.14 146.56 147.42 150.40
70 HOSIERY 153.30 154.38 156.75 156.94
71 SILK & REYON T EXT ILES 143.60 144.28 149.15 149.62
72 WOOLEN T EXT ILES 130.66 137.37 139.79 141.56
73 JUT E MANUFACT URES 123.27 123.97 128.60 132.09
74 MAT T RESSES 134.33 135.78 140.61 141.72
75 READY MADE GARMENT S 114.62 116.07 118.87 118.87
76 UT ENSILS 146.03 146.64 148.79 148.79
77 PLAST IC PRODUCT S 132.53 138.47 140.48 141.08
78 GLASS PRODUCT S 148.05 168.15 179.81 179.81
79 CHEMICALS 151.35 162.04 189.84 198.28
80 DYING MAT ERIALS 88.36 88.36 88.99 88.99
81 SOAPS 180.03 180.62 183.88 183.88
82 COSMET ICS 117.54 119.58 121.91 123.62
83 DRUGS & MEDICINES 105.90 110.29 115.82 116.73
84 FERT ILIZERS 298.47 291.55 297.34 304.86
85 PEST ICIDES & INSECT ICISED 139.17 146.74 148.35 149.39
86 MACHINERY 174.22 175.23 177.90 177.90
87 T RANSPORT S 124.01 124.15 129.05 129.05
88 T YRES 213.15 208.67 208.57 208.57
89 T UBES 187.00 184.79 187.73 187.73
90 AUDIO-VISUAL INST RUMENT S 91.85 92.25 92.28 92.28
91 OT HER ELECT RICAL GOODS 123.50 130.55 131.27 131.27
92 CIGARET T ES 171.57 171.57 197.49 197.49
93 PAPER 105.98 105.98 105.98 105.98
94 MAT CHES 124.26 124.26 124.26 124.26
95 FOOT WEAR 177.36 177.36 192.15 192.15
BUILDING MATERIAL 205.10 201.15 200.37 202.43
96 CEMENT 146.06 141.82 124.02 124.02
97 BRICKS 227.00 232.92 246.93 248.68
98 CEMENT BLOCKS 166.63 166.63 170.83 170.83
99 T ILES 99.17 99.67 99.67 99.67
100 IRON BARS & SHEET S 254.01 248.46 257.22 260.59
101 PIPE FIT T INGS 178.13 180.51 185.05 185.05
102 T IMBER 203.48 209.88 208.88 208.88
103 GLASS SHEET S 164.77 168.78 177.94 177.94
104 PAINT S & VARNISHES 144.23 146.05 146.05 149.43
105 SANIT ARY WARES 143.85 145.77 162.20 162.20
106 WIRES AND CABLES 256.66 259.37 262.08 270.43

32
 State Bank of Pakistan

Table A11: Price Indices - Base 2000-01=100

Period CPI WPI SPI *

O verall Food Non-food O verall Food Non-food
2004-05 121.98 125.69 119.47 124.14 125.03 123.50 126.52
2005-06 131.64 134.39 129.78 136.68 133.78 138.78 136.43
2006-07 141.87 148.21 137.59 146.18 145.67 146.53 149.29
2007-08 158.90 174.36 148.44 170.15 173.27 167.88 170.55
2008-09 191.90 215.69 175.82 201.10 213.54 192.04 209.29

2008 Jan. 157.73 172.96 147.43 166.75 172.50 162.57 168.24

Feb. 158.50 172.16 149.26 168.81 172.40 166.20 166.94
Mar. 163.38 180.52 151.79 175.55 177.57 174.08 173.96
Apr. 168.34 188.37 154.80 183.09 184.07 182.38 183.29
May. 172.87 196.28 157.04 192.19 194.26 190.68 191.49
Jun. 176.50 201.12 159.85 197.92 199.39 196.85 194.10
Jul. 182.39 206.85 165.85 206.53 206.37 206.65 202.94
Aug. 186.29 212.21 168.76 211.60 211.91 211.37 208.85
Sep. 188.10 214.13 170.50 211.02 213.63 209.12 209.52
Oct. 192.08 221.44 172.23 207.08 219.58 197.98 213.37
Nov. 191.85 218.12 174.09 196.50 215.97 182.33 211.03
Dec. 190.90 214.71 174.80 192.62 210.77 179.41 207.99

2009 Jan. 190.09 210.33 176.40 192.91 208.80 181.35 204.02

Feb. 191.90 211.58 178.59 194.19 210.31 182.46 206.78
Mar. 194.53 216.13 179.92 195.00 212.16 182.51 208.40
Apr. 197.28 220.46 181.61 198.28 215.69 185.61 210.85
May. 197.74 220.04 182.66 201.29 217.50 189.49 212.62
Jun. 199.69 222.23 184.45 206.13 219.81 196.17 215.09
Jul 202.77 228.93 185.08 207.57 224.31 195.39 222.00
Aug 206.21 234.69 186.95 212.16 229.52 199.53 225.18
Sep 207.14 235.59 187.90 212.53 230.34 199.57 227.34
Oct 209.11 238.12 189.49 215.01 232.35 202.39 227.73
Nov 212.02 242.40 191.48 220.98 236.69 209.55 232.14
Dec 210.99 238.16 192.62 221.43 235.06 211.51 232.81

2010 Jan. 216.09 242.91 197.95 230.80 241.37 223.11 240.25

Feb 216.93 243.17 199.19 231.64 242.67 223.61 242.37
Mar 219.65 247.55 200.78 237.51 246.68 230.84 244.98
*: all groups combined

33
Inflation Monitor, March 2010

Table A12: International Commodity Prices/Indices

Current Prices YoY Change MoM Change
Mar-10 Feb-10 Mar-10 Feb-10 Mar-10
Energy
Crude Oil (US$ per barrel)* 79.3 79.1 68.9 -3.0 6.0
IMF Energy Index (2005 =100) 146.1 56.0 55.9 -2.9 5.0
WB Energy Index (1990=100) @ 259.8 63.1 52.9 -3.1 0.2
Food
Rice ($/MT ) 544.4 -7.8 -12.9 -2.2 -6.9
Wheat ($/MT ) 191.1 -13.5 -17.3 -3.4 -1.7
Sugar (US cent / pound) 19.3 95.0 49.0 -8.5 -25.8
Palm Oil ($/MT ) 793.9 42.5 42.5 1.7 5.2
Soybean Oil ($/MT ) 869.3 19.7 25.2 0.2 3.4
Non-Food Non-Energy
Cotton Outlook 'A' Index # 85.8 45.0 66.6 3.4 7.2
IMF Metal Price Index (2005=100) 156.3 55.8 62.0 -5.6 7.1
Copper ($/MT ) 7,466.9 106.3 98.0 -6.8 8.7
Aluminum ($/MT ) 2,210.5 53.5 65.2 -7.9 7.7
T in ($/MT ) 17,509.1 47.7 63.8 -7.7 7.1
Nickel ($/MT ) 22,467.2 83.1 131.4 3.6 17.9
Zinc ($/MT ) 2,277.3 93.1 86.2 -10.6 5.5
Lead ($/MT ) 2,162.7 93.3 73.5 -9.6 1.7
Uranium ($/pound) 40.9 -10.5 -5.7 -4.0 -2.8
DAP ($/MT ) 476.3 33.3 29.5 14.7 -2.9
Urea ($/MT ) 278.8 5.6 5.0 4.7 -3.4
$/MT = US$ per metric tonne.
* Crude Oil (petroleum), simple average of three spot prices; Dated Brent, West T exas Intermediate, and the
# Middling 1-3/32 inch staple, Liverpool Index "A", average of the cheapest Cts/lb five of fourteen styles, CIF
Liverpool (Cotton Outlook, Liverpool). From January 1968 to May 1981 strict middling 1-1/16 inch staple.
Prior to 1968, Mexican 1-1/16. 2/
DAP: Diammonium Phosphate
@ World bank commodity index for low and middle income countries
Source: IMF and World Bank.

34
 State Bank of Pakistan

Figure A1: CPI Non-food Inflation (percent)

YoY 12mma MoM (RHS)
Transport & communication Fuel & Lighting
51 15 36 16
31 14
41 10 12
26 10
31
5 21 8
21 16 6
0 4
11 11
2
1 -5 6 0
-9 -10 1 -2

Apparel , textile & footwear Houshold furniture & equipment

17 5 16 2
15 14
4 2
13 12
11 3
10 1
9 2
7 8
1
1 6
5
3 0 4 0

Cleaning, laundry & persn. appearance Education

21 4 24 8
21
18 3 6
18
15 15
2
12 4
12
1
9 9 2
6 0 6
3 -1 3 0

Recreation & entertainment Medicare

17 11 16 7
14 9 14 6
5
11 7 12 4
8 5 10 3
5 3 8 2
1
2 1 6 0
-1 -1 4 -1
May-08

May-09
Mar-08

Mar-09

Mar-10
Sep-08

Sep-09
Jan-09

Jan-10
Nov-08

Nov-09
Jul-08

Jul-09
May-08

May-09
Mar-09

Mar-10
Mar-08

Sep-09
Sep-08

Jan-09

Jan-10
Nov-08

Nov-09
Jul-08

Jul-09

35
36
frequency (no. of Items) frequency (no. of Items)

0
4
20

12
16
0
20
40
60
80
100
<=-10.00 <=-10.00
-8 to -7 -8 to -7
-5 to -4 -5 to -4
-2 to -1 -2 to -1 Frequency
I to 2 I to 2 YoY price changes
4 to 5 4 to 5
7 to 8 7 to 8
10 to 11 10 to 11
Inflation Monitor, March 2010

12-month ma food price changes

price intervals in percent

13 to 14 13 to 14
16 to 17 16 to 17
19 to 20 19 to 20

0
20
40
60
80

40
20
60
80
100
Cumulative frequency %

100
% cumulative frequency % cumulative frequency

frequency (no. of Items) frequency (no. of items)

0
60

12
24
36
48
0
80

20
40
60
100
120
140

<=-10.00 <=-10.00
-8 to -7 -8 to -7
-5 to -4 -5 to -4
-2 to -1 -2 to -1
I to 2 I to 2
4 to 5 4 to 5
Figure A2: Frequency Distribution of Price Changes of CPI Items, March 2010

7 to 8 7 to 8
12-month ma price changes

10 to 11 10 to 11
13 to 14 13 to 14

price intervals in percent

16 to 17 16 to 17
12-month ma non-food price changes

19 to 20 0 19 to 20
0
40

20
40
60
80
20
60
80

100
100

% cumulative frequency % cumulative frequency

 State Bank of Pakistan

Figure A3: Frequency Distribution of Price Changes of WPI Items, March 2010
Frequency Cumulative frequency
YoY price changes 12-month ma price changes
24 100 48 100

% cumulative frequency
Frequency (No. of items)
Frequency (No. of items)

80 40 80

% cumulative frequency
18
32
60 60
12 24
40 40
16
6 20
20 8

0 0 0 0
Price intervals in percent Price intervals in percent

12-month ma food price changes 12-month ma non-food price changes

24 100
Frequency (No. of items)

% cumulative frequency

% cumulative frequency
24 100
Frequency (No. of items)

20 80 20 80
16 16
60 60
12 12
40 40
8 8
4 20 4 20
0 0 0 0
<=-10.00

13 to 14
15 to 16
17 to 18
11 to 12

19 to 20
-9 to -8

-3 to -2
-7 to -6
-5 to -4

9 to 10
-1 to 0

5 to 6
7 to 8
3 to 4
I to 2

<=-10.00

11 to 12
13 to 14
15 to 16
17 to 18
19 to 20
-9 to -8
-7 to -6
-5 to -4
-3 to -2

9 to 10
-1 to 0
3 to 4
5 to 6
7 to 8
I to 2

Price intervals in percent Price intervals in percent

37
Inflation Monitor, March 2010

Annexure B

Technical Notes

1. All the three measures of inflation, viz. CPI, WPI and SPI are computed
by the following Laspeyres Index formula:
 Pt j 
I t   w  j 
0
j

j  P0 

where It is price index, w0j is weight of commodity j in the overall basket,

Pt j is price of commodity j in period t and P0 j is its price in the base year.

2. Base year for all the indices is the year 2000-01.

3. CPI basket contains 374 consumers’ goods; WPI basket contains 425
commodities; SPI contains 53 commodities.

4. YoY inflation is the percent change of an index in a given month over the
index in the same month of the last year. It is computed as follows:
It
t  (  1)  100
I t 12

5. Period average inflation is the percent change of the average index during
the period from July to the given month of a fiscal year over the average
index during the corresponding period of the last year. It is computed as
follows:
 t  
  I t i 

 t  t 12
i 0
 1  100
 
  I t 12i 
 i 0 
where v is the serial number of the month of July of current fiscal year in a
given time series.

38
 State Bank of Pakistan

6. Monthly inflation is the percent change of an index in a given month over

the index in the preceding month. It is computed as follows:
It
t  (  1)  100
I t 1

7. 12-month moving average inflation (Long-run trend inflation) is the

percent change of 12-month moving average of a price index; it is
computed as follows:
 11 
  I t i 
~ 
 t  11 i 0
 1  100
 
  I t 12i 
 i 0 

8. Core Inflation is defined as the persistent component of measured

inflation that excludes volatile and controlled prices. It reflects the normal
supply and demand conditions in the economy. Core inflation is computed
by the following two methods:
a) Non-food, Non-energy inflation (NFNE inflation); it is computed
by excluding food group and energy items (kerosene oil, petrol,
diesel, CNG, electricity and natural gas) from the CPI basket.

b) 20% trimmed-mean inflation; it is computed through the

following steps:
i. All CPI items are arranged in ascending order according
to YoY/12-month moving average/monthly/period
average changes in their price indices in a given month.
ii. 20 percent of the items showing extreme changes are
excluded with 10 percent of the items at the top of the
list (corresponding to cumulative weight of 90% or
more) and 10 percent of the items at the bottom of the
list (corresponding to cumulative weight of 10 percent
or less).
iii. The weighted mean of the changes in price indices of
the rest of the items is core inflation.

9. Weighted contribution of different items (or sub-groups) to total inflation

is worked out as below:

Let the overall index (It) is the weighted average of price indexes of
individual items or sub-groups (Iit), i.e.

39
Inflation Monitor, March 2010

I t   wi  I it
i
The weighted contribution of a single item (or a sub-group) to overall
inflation is defined as below:
 
Cit   it 12  wi   it 
 t 
Where C it : Contribution of ith item to the overall inflation
I
 it 12  it 12 ; i.e. ratio of item’s index to overall index in
I t 12
the reference month
wi : Weights of ith item
 it : Inflation of ith item
 t : Overall inflation

40