WEB DESK: Pakistan’s headline inflation has shown signs of relief, registering at 17.3 per cent year-on-year in April, according to the latest data released by the Pakistan Bureau of Statistics (PBS) on Thursday. This figure marks a decline from March’s 20.7 per cent. On a month-on-month basis, the inflation rate dropped to 0.4 per cent.
Mohammed Sohail, CEO of brokerage house Topline Securities, hailed this as a significant development, noting that it’s the lowest reading in nearly two years, tracing back to May 2022.
The average inflation for July to April now stands at 25.97 per cent, a decrease from the previous year’s 28.23 per cent in the same period.
The latest figures come in lower than the government’s expectations, as outlined in the Ministry of Finance’s ‘Monthly Economic Update and Outlook’ report earlier in the week. The report projected inflation to range between 18.5-19.5 per cent for April, with further deceleration anticipated in the months ahead.
The ministry attributed this optimistic outlook to the favorable base effect from the previous year and improvements in the domestic supply chain for essential goods. It also stressed the government’s commitment to curbing inflation through strict administrative measures.
Urban and rural areas experienced different inflation rates, with urban inflation dropping to 19.4 per cent year-on-year in April, compared to 21.9 per cent in the previous month. Rural inflation stood at 14.5 per cent, down from 19 per cent in March.
Meanwhile, the State Bank of Pakistan’s Monetary Policy Committee (MPC) opted to maintain the key policy rate at 22 per cent in its latest meeting, marking the seventh consecutive decision to hold steady. The committee acknowledged the progress in stabilising the macroeconomic situation but stressed that inflation remains high. It highlighted potential risks such as global oil price volatility and fiscal consolidation measures.
Despite the challenges, the committee expressed confidence in the downward trajectory of inflation, aiming to reach the target range of 5–7 per cent by September 2025.
