The Consumer Price Index (CPI), comprising a basket of 487 goods and services, rose 8.55 percent in August, reported Pakistan Bureau of Statistics (PBS).

In July, inflation stood at 8.23 percent. It was the second consecutive month when CPI-based prices increased, which came before the announcement of monetary policy by the State Bank of Pakistan on September 13, media reported.

However, the August inflation was below the expectations of independent economists and projections by the Planning Commission.

In August, the government had significantly increased prices of electricity for industrial, commercial and bulk consumers. Rates of petroleum products, transport fares and prices of wheat and wheat flour were also increased.

PBS included no impact of higher electricity tariffs for industrial, commercial and bulk consumers in CPI calculation, said Asif Bajwa, Chief Statistician of Pakistan.

Technically, he said, the PBS could not count the increase in tariffs for commercial and industrial consumers in the CPI which is a consumer index. PBS also included no effect of rise in electricity tariffs in the Wholesale Price index (WPI), said Bajwa.

The cost of expensive electricity for industrial consumers would gradually trickle down to end consumers through increase in prices of products manufactured by these units, he added. In the CPI, the commodity group comprising housing, water, electricity, gas and fuel recorded a rise of 6.5 percent in August over the same month last year, according to the PBS.

For the current fiscal year 2013-14, the federal government has set the inflation target at 8 percent. Initial administrative, monetary and fiscal trends suggest the target may be missed, the report said.

The higher electricity tariffs for domestic consumers will come into effect from next month. The CPI data showed that prices of perishable food items went up by 18 percent in August over the corresponding month a year ago.

The Pakistani Rupees too has been falling. At the moment, the exchange rate of a dollar hovers at about Rs 104 in the open market. While earlier value of Pakistani Rupee was nearly double of Indian Rupees, the recent fall of the Indian currency against USD has decreased the gap.

(Agencies)

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