(Bloomberg) -- Pakistan’s inflation cooled last month despite lingering price shocks from the flooding, a sign that aggressive rate hikes and fiscal policy tightening is dampening demand.

Consumer prices rose 23.84% in November from a year earlier, according to government data released Thursday. That compares with a median estimate for a 24.55% gain in a Bloomberg survey and a 26.56% jump in October.

Food inflation quickened 31.16% year-on-year, while transport prices rose 44.22%, data showed. Clothing and footwear prices jumped 18.58% and housing, water and electricity costs rose at 9.89%.

The easing comes as Pakistan’s monetary authority resumed its rate hikes last month to prevent faster-than-anticipated inflation from spiraling out of control. State Bank of Pakistan has delivered 625 basis points of rate hikes this year taking its target rate to 16%.

A tighter fiscal policy advocated by the International Monetary Fund, import restrictions and a fall in global commodity prices also helped in easing prices.

“Although headline inflation softened, core inflation continued to surge on a monthly basis, rising by more than 1% for a sixth consecutive month,” said Fahad Rauf, head of research at Ismail Iqbal Securities Pvt Ltd. in Karachi. “Core inflation continues to be the central bank’s focus and will be critical in policy decisions.”

Rauf expects consumer prices to remain at current levels over the next few months and inflation to average 23.5%, slightly higher than the central bank’s range of 21%-23%, which was revised upward last week. 

Pakistan is facing multiple economic challenges including the deterioration in foreign exchange reserves that cover only about one month worth of imports, making debt repayments difficult. 

Talks with the IMF for the next loan tranche are delayed as the nation evaluates how much it will spend this year to rebuild the country after the devastating floods.

(Updates with analyst comment in seventh and eighth paragraphs)

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