Pakistan’s inflation rate could soon rise as high as 13.5 per cent, according to the International Monetary Fund (IMF).
The country’s inflation rose to a four-month high in August as devastating floods forced food prices higher. Core inflation rose to a higher-than expected 12.5 per cent, as the consumer price index increased 2.5 per cent from July.
Analysts had expected the central bank to wait and see until the release of a damages assessment report, due to be released in mid-October, but with inflation higher than expected, there are fears that the central bank may hike the policy rate.
The IMF has pledged $451m (£287m) in aid to the stricken nation, which will be used to plug the gap in public spending and shore up its flagging currency.