ISLAMABAD, Dec 11: Inflation decelerates from a three-decade high in November 2008 after hefty decrease in domestic oil prices in the wake of slump in oil prices in international market.

The inflation measured through Consumer Price Index (CPI) eased to 24.68 per cent in November from 25 per cent, the highest-ever recorded in October, suggested data of the Federal Bureau of Statistics here on Thursday.

The decrease in oil prices and perishable food items resulted into a 0.21 per cent decline in CPI in November over the previous month.

Though the State Bank of Pakistan (SBP) had raised its benchmark interest rate four times this year but the core inflation (non-food non-energy) has yet to show some let-up. The core inflation was steadily on the rise despite the tightening of monetary policy.

The statistics showed that core inflation also reached all time high of 18.9 per cent in November compared to 6.9 per cent last year despite so-called tight monetary policy adopted by the central bank.

The core inflation is also rising on account of surging house rent and sub-indices related to medical care. The house index rent rose by 16.80 per cent and medical care cost by 12.55 per cent.

Analysts said that SBP will now definitely further increase rates in its next monetary policy in January as agreed as part of a $7.6 billion IMF package to tame the rising core inflation.

The average inflation in the first five months (July-Nov) reached 24.65 per cent from 7.85 per cent last year. The IMF has projected the annual inflation at 23 percent, while the finance ministry has revised inflation target to 22 per cent from earlier 12 per cent.

Under the home-grown stabilisation package, the government estimated to reduce inflation to 9.5 per cent by 2010-11. The strategy paper has projected inflation for the current fiscal year at 22 per cent, for next year at 13 per cent and 9.5 per cent for 2010-11.

Analysts said although the prices of edible oil and crude had declined drastically in the international market, but the headline inflation was not going to ease because the government was determined to raise utility tariffs. The food inflation increased to 30.44 per cent in November over the same month last year. Prices of non-perishable food items witnessed a rise of 31.95 per cent and that of perishable items 21.29 per cent. The non-food inflation reached over 31 per cent in November over the same month last year.

The government reduced prices of petrol by Rs30 per litre and diesel by Rs10 in the past two months. A further reduction is expected, which would ease some pressure on the headline inflation.

Despite this decline in oil prices, the transport fares edged by 28.62 per cent in November over the last year. However, a 7.61 per cent reduction in fares was recorded in November over the previous month of October.

Analysts said the inflation would remain on the higher side for several months owing to increase in prices of wheat, sugar, etc, which might accelerate further in coming months. The cost of the text books, tuitions fees etc also increased by 16.33 per cent in the month under review over the last year.

The statistics showed that the inflation measured through sensitive price index -- a weekly indicator -- was up by 29.79 per cent compared to 11.01 per cent. The inflation in the wholesale manufactured products also witnessed increase by 19.87 per cent compared to 12.64 per cent over the same month last year.