Pakistan’s Inflation Hits Record Low at 0.3% in April 2025
Pakistan’s headline inflation plummeted to 0.3% year-on-year (YoY) in April 2025, down from 0.7% in March, marking its lowest level in decades, according to the Pakistan Bureau of Statistics (PBS). On a monthly basis, prices fell by 0.8%, contrasting with a 0.9% rise in March and a 0.4% decline in April 2024.
Key Highlights:
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Historic Low Inflation: Analysts attribute the sharp drop to rebasing effects, with food and electricity prices driving the decline.
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FY25 Average at 4.73%: The 10-month average CPI inflation for FY25 stands at 4.73%, a dramatic fall from 25.97% in the same period last year.
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Peak Inflation Behind: After hitting 38% in May 2023, inflation has steadily eased, supported by tighter monetary policy and stabilizing commodity prices.
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Urban vs. Rural Split:
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Urban inflation slowed to 0.5% YoY (from 1.2% in March).
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Rural inflation turned negative at -0.1% YoY, with a 1% monthly decline.
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Monetary Policy Outlook: The State Bank of Pakistan (SBP) is expected to hold the policy rate at 12% in its upcoming meeting, following a cumulative 1,000 basis points cut since June 2024.
Market Expectations Met
The latest figures align with forecasts, as Topline Securities had projected April inflation between 0.05% and 0.5%, citing falling food and energy costs.
Pakistan’s inflation has entered near-zero territory, reflecting successful stabilization efforts after years of soaring prices. While this eases cost-of-living pressures, the central bank is likely to maintain caution, keeping interest rates steady to ensure inflation remains subdued. The focus now shifts to sustaining this trend while supporting economic growth.
