What Explains the Current High Rate of Inflation in Pakistan?
Author InfoM. Aynul Hasan (CIDA and Acadia University, Canada.) Ashfaque H. Khan (Pakistan Institute of Development Economics, Islamabad.) Hafiz A. Pasha (Institute of Business Administration, Karachi.) M. Ajaz Rasheed (ISSP, Karachi.) Abstract One of the most significant developments in the current economic scene in Pakistan has been the sharp increase in the rate of inflation. The annual average rate of increase in the wholesale price index (WPI) during the first seven months (July-January 1994-95) of the current fiscal year has been about 19 percent as opposed to 11.3 percent during the same period last year. A similar increase was also witnessed in the consumer price index (CPI) which accelerated to 13 percent as opposed to 11.1 percent during the previous period. Such a sharp increase in prices in recent months has not only caused alarm in the academic circles but has equally disturbed the country’s chief executive, the Prime Minister. The recent surge of inflation is a matter of
