Pakistan’s Inflation landscape is witnessing a period of relative stability, with the inflation rate expected to hover between 2.0% and 2.5% in February 2025. This projection aligns closely with the 2.4% inflation rate recorded in January, as reported by the Pakistan Bureau of Statistics (PBS).
Recent Trends in Pakistan’s Inflation
- January 2025: Inflation stood at 2.4%, marking a significant decline from the 4.1% observed in December 2024.
- December 2024: The rate was 4.1%, continuing a downward trend from previous months.
Factors Contributing to Pakistan’s Inflation Rates
Several elements have influenced the current inflation trajectory:
- Base Effect: The high inflation rates experienced in the previous year have created a statistical base effect, contributing to the perception of reduced inflation in recent months.
- Currency Stability: The Pakistani rupee has maintained relative stability against major currencies, mitigating imported inflation pressures.
- Commodity Prices: A decrease in global food and energy prices has positively impacted domestic markets, leading to lower consumer prices.
Monetary Policy Adjustments:
In response to the easing inflation, the State Bank of Pakistan (SBP) has implemented a series of policy rate cuts:
- Pakistan’s Inflation December 2024: A reduction of 200 basis points brought the policy rate down to 13%.
- Pakistan’s Inflation January 2025: An additional 100 basis points cut lowered the rate further to 12%.
Pakistan’s Inflation measures aim to stimulate economic activity by making borrowing more affordable for businesses and consumers.
Outlook for the Coming Months
Analysts anticipate Pakistan’s Inflation will remain within the current range in the near term. However, potential risks such as fluctuations in global commodity prices and domestic supply chain challenges could influence future rates. The SBP continues to monitor these developments to adjust monetary policies accordingly.
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