Pakistan’s inflation seen picking up in May after record lows 

ISLAMABAD: After a period of unusually low inflation, Pakistan is expected to see a modest rise in consumer prices in May, according to a report by brokerage firm JS Global.  

The report forecasts that headline inflation will reach 2.7 per cent year-on-year in May 2025, up from just 0.3 per cent in April. The increase is attributed to the fading base effect, which had temporarily held down inflation figures.  

Official data from the Pakistan Bureau of Statistics (PBS) showed that inflation stood at 0.3 per cent in April, compared to 0.7 per cent in March. These low readings followed a period of steep inflation in previous years.

According to JS Global, as the base effect wears off, inflation is returning to more typical patterns. It estimates that the average inflation for the first eleven months of the current fiscal year (11MFY25) will be 4.7 per cent, significantly lower than the 24.9 per cent average during the same period last year.  

In May 2023, Pakistan recorded its highest inflation rate on record at 38 per cent year-on-year, the highest since the PBS began publishing data in July 1965.  

Food prices are expected to increase by 1.4 per cent year-on-year in May 2025, after registering a slight decline of 0.2 per cent in the same month last year. The change is again linked to the diminishing base effect.  

In contrast, housing, gas and electricity prices are projected to fall by 3.3 per cent year-on-year and decline by 2 per cent compared to the previous month, mainly due to a cut in electricity tariffs.  

Core inflation, which excludes food and energy prices, is expected to have been around 9 per cent year-on-year in April. 

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