Yearly inflation drops to 59-Year low at 0.7% in March

Sharp decline from last year’s record 38% inflation signals continued economic stabilisation

Pakistan’s headline inflation dropped to 0.7% year-on-year in March 2025, marking a further decline from February’s 1.5% reading, according to Pakistan Bureau of Statistics (PBS) data released on Thursday. On a month-on-month basis, inflation edged up by 0.9%, reversing the 0.8% decline recorded in February. Analysts at Arif Habib Limited noted that this was the lowest inflation reading since December 1965, a 59-year low based on State Bank of Pakistan (SBP) data.

The sharp decline stands in contrast to the inflationary pressures of recent years, which peaked at a record 38% in May 2023 before beginning a steady decline. Over the first nine months of the fiscal year 2025, average inflation stood at 5.25%, a stark improvement from the 27.06% recorded in the same period last year.

The Finance Division had earlier projected March inflation to remain between 1% and 1.5%, with expectations of a slight increase to 2-3% in April. The Monetary Policy Committee (MPC), in its most recent meeting, kept the policy rate unchanged at 12%, acknowledging that February’s inflation had been lower than expected due to declines in food and energy prices. However, the committee cautioned that price volatility in these sectors posed risks to the downward inflation trend.

Urban inflation declined to 1.2% year-on-year in March, compared to 1.8% in February, while rural inflation remained unchanged at 0%, reflecting a significant slowdown from the double-digit levels seen in the previous year. The latest CPI figures align with projections from several brokerage firms, with Topline Securities anticipating a reading between 0.5% and 1%, the lowest in over three decades.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Must Read

Gold price in Pakistan for today, April 04, 2025

Gold prices in Pakistan fluctuate frequently based on international market trends. The rates listed are provided by local gold markets and Sarafa Markets in...