News
Pakistan's Wholesale Inflation Reaches 13.3%, Weekly Inflation at 11.53%
By Mariam Khan
Real Estate Analyst
3 min read
The National Price Monitoring Committee (NPMC) was informed that Pakistan's Wholesale Price Index (WPI) increased 13.3 percent year on year, while weekly consumer price inflation reached 11.53 percent year on year for the week ending October 1. Price statistics are published by the Pakistan Bureau of Statistics.
Why Wholesale Prices Matter to Builders
The WPI tracks prices at the wholesale stage, before goods reach consumers. Construction materials are bought at that level, so wholesale inflation is relevant to builders and developers. The reports we have seen do not break the 13.3 percent down by commodity, so we cannot say how much of it comes from cement, steel, fuel or other inputs.
Why the Wholesale and Weekly Figures Differ From the Monthly CPI
The 13.3 percent WPI figure is higher than the 10.3 percent CPI inflation for September that we reported in Pakistan Inflation Eases to 10.3% in September. They measure different baskets at different stages, so they are not directly comparable. A WPI that is higher than CPI can indicate cost pressure at earlier stages of the supply chain, but the reports do not say that businesses are passing these costs on, and we have not assumed it.
Why the Weekly Figure Is Slightly Lower Than the Previous Week
The 11.53 percent weekly reading for the week ending October 1 compares with the 11.92 percent we reported for the week ending September 24 in Pakistan's Weekly Inflation Reaches 11.92% as Electricity Charges Jump. That is a fall of 0.39 percentage points (our own calculation). The reports on this item do not say which price index the weekly figure refers to, and we have assumed it is the same weekly indicator, so that comparison should be checked against the PBS release.
Why Fuel and Electricity Keep Pressure on Costs
Recent decisions point to continuing cost pressure, including the fuel price increase effective October 9, the approved electricity fuel-cost adjustment of Rs1.11 per unit and the World Bank's warning on energy and freight costs. Whether these are reflected in the wholesale index is not reported.
What This Means for Developers, Contractors and Buyers
Developers and contractors should treat the wholesale reading as a sign that input costs remain high and should keep contingencies in project budgets. Buyers of off-plan property could see developers cite higher costs. High inflation also complicates interest-rate reductions, which would affect mortgage affordability. The signals to watch are the next weekly price release, the monthly CPI and the breakdown of wholesale prices by commodity. Data is published by the Pakistan Bureau of Statistics.