Pakistan’s consumer inflation jumped back into double digits in April after nearly two years, as rising transport fares and energy prices pushed up the cost of living across the country, official data showed.
The Consumer Price Index rose by nearly 11 percent year on year in April, compared with 11.1 percent in July 2024, the last time inflation crossed the 10 percent mark. The latest figures reflect renewed pressure on households already struggling with high utility bills and volatile food prices.
On a month on month basis, inflation increased by 2.48 percent in April, according to data released by the Pakistan Bureau of Statistics.
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Transport, fuel and food drive surge
The sharp rise in inflation was largely driven by transport costs, which surged 15.47 percent compared to the previous month. Perishable food items also recorded a steep increase of 15.25 percent, underlining continued volatility in essential commodities.
Urban inflation stood at 11.11 percent annually, slightly higher than 10.56 percent in rural areas. Monthly inflation in cities rose by 2.75 percent, compared to 2.09 percent in rural regions.
Food inflation increased by 6.9 percent in urban areas and 7.3 percent in rural areas. Meanwhile, non food inflation remained elevated at 13.8 percent in urban centres and 13.6 percent in rural areas.
Among key food items, tomatoes rose by 57.10 percent, fresh vegetables by 40.67 percent, and eggs by 14.38 percent. Prices of onions, potatoes, milk products and meat also increased.
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Non food categories saw even sharper spikes. Motor liquified hydrocarbons jumped by 38.34 percent, transport services by 27.86 percent, and motor fuel by 18.22 percent. Housing, water, electricity, gas and fuels also rose by 2.43 percent, adding to household strain.
Energy shock and policy response
Analysts link the inflation surge to global energy disruptions, particularly the blockage of the Strait of Hormuz. The route handles a large share of Pakistan’s oil imports.
Prime Minister Shehbaz Sharif said the country’s weekly oil import bill had risen sharply. He stated that it jumped to 800 million dollars from 300 million dollars before the US Israel war began on Feb 28.
The State Bank of Pakistan responded by raising its policy rate to 11.50 percent from 10.50 percent. The central bank had kept rates unchanged since December 2025.
However, former economic adviser Dr Ashfaq H. Khan criticised the move. He said, “the United States triggered the global energy crisis through war in the Middle East, followed by Iran blocking the Strait of Hormuz, pushing up energy prices and fuelling global inflation.”
He added that “interest rates are a demand-side tool, effective when demand exceeds supply.” He warned that tightening policy in a supply driven inflation environment could lead to stagflation.
Dr Ashfaq termed the rate hike a wrong decision, saying it was taken to meet commitments made to the International Monetary Fund.
Inflation outlook and pressures ahead
Inflation between July and April reached 6.19 percent in fiscal year 2025-26, up from 4.73 percent in the same period last year. This rise comes despite a high base effect.
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Core inflation, which excludes food and energy, stood at 8 percent in urban areas and 8.5 percent in rural regions. This indicates persistent underlying price pressures.
The government has set an inflation target of 7 percent for the current fiscal year. However, rising fuel costs, supply shocks and currency pressures may make that target difficult to achieve.
For consumers, the latest spike signals continued erosion of purchasing power. While some relief has emerged from lower wheat and flour prices, rising transport and utility costs continue to outweigh those gains.
