ISLAMABAD: Pakistan’s Ministry of Finance has projected consumer inflation for September 2025 to remain within the 3.5–4.5% range, citing flood-related disruptions in the country’s supply chains.
In its monthly outlook, the Ministry stated that despite the challenges posed by recent floods, economic activity has remained broadly stable.
The Ministry highlighted a rebound in large-scale manufacturing, driven by positive trends in cement dispatches, automobile production, and allied industries, indicating a strengthening industrial outlook.
Pakistan experienced severe flooding as part of the extended monsoon season that began in late June 2025 and intensified through September, affecting densely populated areas, particularly in Punjab.
The Ministry also projected that the external sector would remain stable, with the current account deficit expected to stay manageable despite increased import demand.
Remittances continue to provide strong support, exports are showing early signs of recovery, and declining global commodity prices may ease the import bill.
However, the Ministry warned that flood-related disruptions could exert pressure on food supply chains, leading to a temporary rise in inflation, which is expected to remain contained within the projected range of 3.5–4.5% for September.
Pakistan’s headline inflation was 3% on a year-on-year basis in August 2025, down from 4.1% in July 2025, according to Pakistan Bureau of Statistics (PBS) data.
In related news, the State Bank of Pakistan (SBP) decided to keep the policy rate unchanged at 11% in its latest Monetary Policy Committee (MPC) meeting, citing the adverse impact of floods on the macroeconomic outlook.
