ISLAMABAD: Pakistan’s annual inflation rate rose to 7 percent year-on-year in February, the statistics bureau said on Monday, with fears of commodity prices volatility after US and Israel strikes in Iran.
The consumer price index of annual inflation jumped from 5.8 percent the previous month, the bureau said.
On a month-on-month basis, inflation increased by 0.3 percent in February, down from a 0.4 percent rise the previous month.
Pakistan’s stock exchange halted trading on Monday after falling more than 5 percent due to the volatility.
The central bank, which held its policy rate at 10.50 percent in January, has said inflation could exceed its 5 percent to 7 percent medium-term target range for a few months this year, even as growth gains momentum and imports push the trade deficit wider.
The International Monetary Fund, which has cautioned against premature monetary easing under Pakistan’s $7 billion loan program, has urged policymakers to remain data-dependent to anchor inflation expectations and rebuild external buffers.
An IMF mission has started discussions with Pakistani authorities on the third review of the country’s Extended Fund Facility and the second review of its Resilience and Sustainability Facility.
