Qudsia Bano

The latest Sensitive Price Indicator (SPI) data show that weekly inflation relief was uneven across income groups during the week ended January 22, 2026, with higher-income households benefiting more from the decline in prices than lower-income groups, according to figures released by the Pakistan Bureau of Statistics (PBS).

The SPI, which tracks short-term price movements of 51 essential items across 50 markets in 17 cities, declined by 0.48% on a week-on-week basis. However, PBS data indicate that the extent of this decline varied across consumption-based expenditure quintiles, highlighting disparities in how price movements affect households at different income levels.

According to the PBS, the lowest expenditure group (Q1) recorded a week-on-week decline of 0.30% in the SPI. The second quintile (Q2) saw a slightly larger decrease of 0.37%, while the third quintile (Q3) posted a 0.39% decline. The fourth quintile (Q4) recorded a weekly reduction of 0.45%, and the highest expenditure group (Q5) experienced the largest decline of 0.54%. The combined SPI for all groups fell by 0.48% during the reference week.

The variation in weekly declines reflects differences in consumption patterns across income groups. Items that recorded sharp price decreases during the week—such as chicken, potatoes and onions—carry different weights across quintiles. As a result, households in higher expenditure groups, which typically allocate a larger share of spending to certain food and non-food items that declined during the week, experienced relatively greater short-term relief.

While weekly movements showed some easing, the year-on-year data present a different picture. PBS figures indicate that all expenditure groups continued to face higher prices compared to the same week last year. On a year-on-year basis, the lowest expenditure group (Q1) recorded an increase of 4.12%, while the second quintile (Q2) posted the highest annual rise at 5.15%. The third quintile (Q3) saw a year-on-year increase of 4.63%, the fourth quintile (Q4) recorded a rise of 4.14%, and the highest expenditure group (Q5) experienced a comparatively lower annual increase of 3.33%. The combined year-on-year inflation rate stood at 4.18%.

The data show that although higher-income households benefited more from weekly price declines, lower- and middle-income groups continued to face relatively higher annual inflation pressures. The higher year-on-year increase in Q2 and Q3 suggests that price increases in essential goods over the past year have had a more pronounced impact on these groups.

PBS data further show that the weekly decline was broad-based, with all quintiles recording negative week-on-week changes. However, the magnitude of relief increased progressively from the lowest to the highest income group. This pattern underscores the importance of consumption weights in determining how price movements translate into inflation outcomes for different segments of the population.

The SPI breakdown by quintiles provides insight into how changes in essential commodity prices affect households differently. While the combined index captures overall inflation trends, the quintile-wise data highlight distributional aspects of inflation, showing that the benefits of short-term price declines are not evenly shared.

According to PBS, monitoring SPI movements across expenditure groups is essential for assessing the real impact of inflation on households. The latest data for the week ended January 22, 2026, indicate that although weekly inflation eased across all income groups, disparities remain in both the scale of relief and the longer-term inflation burden faced by different segments of society.

The quintile-wise SPI figures illustrate that short-term price relief, while welcome, does not fully offset the cumulative impact of price increases over the past year, particularly for lower- and middle-income households, as reflected in the year-on-year inflation trends.

Credit: INP-WealthPk