Inflation to Remain Between 3-4% in Pakistan

Pakistan’s consumer price index (CPI) inflation is projected to hover between 3% and 4% in June 2025, according to the latest economic outlook from the Finance Ministry. This forecast signals a slight uptick from the previous month’s estimate of 1.5-2%, driven by factors such as rising fuel prices and global market dynamics. The ministry’s report highlights improved investor confidence, with increased private sector borrowing indicating a rise in production activities.

Posts on X reflect similar sentiments, noting that higher remittances and exports are expected to maintain a current account surplus for the fiscal year, supporting economic stability. However, challenges like exchange rate volatility and potential inflation spikes remain concerns for sustaining this trajectory.

The report also points to mixed performance in large-scale manufacturing (LSM), which grew by 2.3% year-on-year in April 2025 but contracted by 3.2% month-on-month. Stable crop yields and a steady exchange rate have helped keep inflation at historically low levels, providing some relief to consumers. As Pakistan prepares its federal budget for 2025-26, set for announcement on June 10, the government aims to balance economic growth with fiscal discipline amid global uncertainties.

Published in SouthAsianDesk, June 30th, 2025

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