Inflation hits 18-month peak at 7pc in February
ISLAMABAD: Consumer inflation accelerated to seven per cent in February from 5.8pc in January, largely driven by higher prices of perishable food items and energy, according to official figures released by the Pakistan Bureau of Statistics on Monday.
The continued rise in monthly inflation, measured through the Consumer Price Index (CPI), reinforces the State Bank of Pakistan’s caution that price pressures may temporarily move beyond its comfort zone as domestic demand strengthens. The finance ministry also reported that inflation will remain in the range of 6pc to 7pc in February, citing a surge in demand and a slowdown in supply lines.
The SBP kept its policy rate unchanged at 10.50pc in response to rising inflation, warning that inflation could remain above its 5pc to 7pc medium-term target range for a few months, even as economic activity gathers pace and rising imports widen the trade deficit.
On a month-on-month basis, inflation increased by 0.3pc compared to the previous month.
Inflation between July and February was recorded at 5.46pc in 2025-26, the lowest since 5.85pc over the corresponding months last year. This lower rate is also due to the high base effect from last year.
The average annual inflation for FY25 dropped sharply to 4.49pc from 23.41pc in the previous year, aided by a high base effect, declining food prices, and lower transport costs. The government has projected an inflation target of 7pc for the current fiscal year.
Economists describe the current trend as disinflation — a slowdown in the pace of price increases, not a general decrease as in deflation — though the cost of living remains high for many households.
Food inflation in February increased by 4.4pc in urban areas and 6.8pc in rural areas. On a month-on-month basis, food inflation dropped 0.8pc in urban areas and 0.5pc in rural areas. Non-food inflation reached 8.3pc in urban areas, and 7.7pc in rural regions. This indicates that non-food inflation remains very high.
In February, core inflation — excluding volatile food and energy components — stood at 7.1pc in urban areas and 8.3pc in rural areas. The central bank has kept the policy rate at 10.5 per cent unchanged, effective from December 16, 2025.
Urban food items that saw notable month-on-month price increases included tomatoes (23.05pc), fresh fruits (11.48pc), pulse mash (8.19pc), beverages (1.65pc), meat(1.45pc), pulse moong (1.25pc), mustard oil (1.20pc), dry fruits (0.78pc), wheat products (0.68pc), readymade food (0.44pc) and pulse gram (0.34pc).
Conversely, declines were noted in eggs (22.39 per cent), chicken (19.99pc), potatoes (15.89pc), pulse masoor (4.03pc), onions (3.90pc), fresh vegetables (3.88pc), besan (1.67pc), vegetable ghee (0.99pc), cooking oil (0.94pc), gur (0.39pc), sugar (0.35pc) and gram whole (0.17pc).
Non-food categories also witnessed significant price hikes, including electricity charges (10.03pc), cleaning and laundry (2.09pc), tailoring (2.04 per cent), solid fuel (1.71pc), doctor (MBBS) clinic fee (1.05pc), liquefied hydrocarbons (0.97 per cent), motor fuel (0.88pc) and mechanical services (0.76 per cent).
Published in Dawn, March 3rd, 2026
