Inflation has been affecting the overwhelming majority of people around the globe, including Pakistan, but it is the higher food prices – besides the increased power and gas tariffs as well as fuel prices – which are proving to be most disturbing aspect for them.
At the same time, increase in food prices are sustaining and fuelling the overall inflation which in turn mean there won’t be any rate cuts soon – a continuation of the monetary tightening as advocated by top financial institutions and central banks.
Hence, interest rates will stay at the record high levels in Pakistan and other developing nations as well as poorest countries which are worst affected by this trend amid currency devaluation and higher import costs due to the increase in commodity prices in global markets.
Therefore, they will remain stuck in the vicious circle of higher inflation and interest rates with no hope for revitalising their economies.
One must remember that the low-income groups form the largest share of population in developing and poor nations. With the living standards and nutrition intake levels already low or very low, the shrinking purchasing power is depriving them of their very basic rights – food.
Nigeria’s annual inflation rose in November for the 11th straight month to the highest level in 18 years, adding pressure on the central bank to tackle the rise amid a worsening cost-of-living crisis in Africa’s largest economy.
Consumer inflation rose to 28.20 per cent in November from 27.33pc in October, data from the National Bureau of Statistics showed on Friday. The last time Nigerians experienced this level of inflation was in August 2005, official data shows.
