The inflation rate in Pakistan has dropped to its lowest level in six and a half years, a success largely attributed to the measures implemented by the Special Investment Facilitation Council (SIFC).
In the first five months of the current fiscal year, the average inflation rate sharply fell from 28.62% to 7.88%, with a remarkable decrease to 4.9% last month.
Urban inflation has decreased annually to 5.2%. This ongoing decline in inflation is anticipated to relieve consumers’ financial burdens by reducing food and transportation expenses.
The Ministry of Finance has recently set an ambitious target to reduce the national inflation rate to 7% by 2027. According to a ministry report, inflation is projected to decline steadily over the next three years, dropping to 12% in 2025 and 7.5% in 2026 before achieving the target of 7% in 2027.
Read: IMF Forecasts Drop in Pakistan’s Inflation Rate to 10.6% by 2025
Furthermore, the report forecasts economic growth to accelerate from 3.6% to 5.5% over the same period. It also anticipates improving the primary balance from 1.02% to 0.5% of the GDP. Strategies are underway to reduce the debt-to-GDP ratio, targeting a decline from 68.6% in 2025 to 66.6% by 2027.
As of November 2024, the core inflation, measured by the Consumer Price Index (CPI), further slowed to 4.9% from 7.2% in October 2024. Comparatively, CPI-based inflation in November 2023 was significantly higher at 29.2%.
Read: Pakistan’s Inflation Drops to 4.9% in November 2024, Marking Six-Year Low
Month-on-month, inflation increased slightly by 0.5% in November 2024, compared to an increase of 1.2% in the previous month and a larger increase of 2.7% in November 2023.
