Islamabad: Pakistan has recorded its first single-digit inflation rate in three years, signaling a notable downturn in consumer price increases. As of August 2024, the Consumer Price Index (CPI) fell to a 34-month low of 9.6%, despite a marginal monthly rise.

According to JS Global, this decline reflects a favorable year-over-year comparison with significantly higher rates from the previous year. The data shows that while the monthly inflation rate edged up by 39 basis points, the broader trend remains on a downward trajectory.

The breakdown by categories reveals mixed trends: food and health sectors saw modest increases, while housing, gas, and electricity recorded a decrease. Particularly, food inflation stood at 2.5% year-over-year, with tobacco and clothing inflation at 6.9% and 17.3% respectively. Housing, gas, and electricity presented a significant drop of 1.4% month-over-month, contrasting with a high annual inflation of 22.2%.

Despite these positive signs, core inflation, which excludes volatile food and energy prices, persisted in double digits. Urban areas reported a core inflation rate of 10.2%, the lowest in over two years, while rural areas saw a slightly higher rate of 14.4%.

The Wholesale Price Index (WPI) also demonstrated improvement, reaching a near four-year low of 6.3% in August, despite a slight monthly increase. This reflects a broader easing of price pressures across the economy, contributing to a cautiously optimistic outlook for Pakistan’s monetary policy.