PM Shehbaz praises ‘record decline’ in inflation, expects further policy rate cuts

ISLAMABAD: Prime Minister (PM) Shehbaz Sharif on Monday praised the significant reduction in inflation, describing it as a “record decline” after six and a half years, according to Business Recorder.

The inflation rate dropped to 4.9 per cent year-on-year in November 2024, down from 7.2 per cent in October, according to data from the Pakistan Bureau of Statistics (PBS). This marks the lowest inflation rate since 2018.

Speaking during a federal cabinet meeting, Sharif expressed optimism that the State Bank of Pakistan’s (SBP) Monetary Policy Committee might further reduce the key policy rate in its upcoming meeting.

He said that controlling inflation could improve the financial situation of the general public, but also acknowledged that rising inflation disproportionately affects low-income groups.

The prime minister highlighted the need to shift focus towards achieving economic growth once stability is restored. This growth, he said, would boost the country’s gross domestic product (GDP), exports, industrial production, and employment.

Sharif also pointed to a rise in revenue collection, which he attributed to stricter enforcement measures by the government.

During the meeting, the cabinet approved a review petition against the Supreme Court’s 2018 ban on monosodium glutamate (MSG), commonly known as Ajinomoto. The decision followed a special committee report, which declared MSG safe for human consumption.

The committee included experts from several national scientific and food institutions.

In other decisions, the cabinet approved the National Prevention of Violent Extremism Policy 2024 and endorsed plans to establish the Islamabad Central Business District Development Authority.

Sharif also referenced the Pakistan Tehreek-e-Insaf (PTI) protests, noting that the uncertainty caused by the demonstrations led to a 3,000-point drop in the Pakistan Stock Exchange (PSX). However, the market rebounded once order was restored.

Additionally, the cabinet reviewed the government’s decision to permit sugar exports, which is expected to bring in $500 million in foreign exchange. The prime minister credited the Pakistan Army’s efforts to curb smuggling along the Afghanistan border for helping stabilise domestic sugar prices.

Sharif also expressed satisfaction over the European Union Aviation Safety Agency’s decision to lift its ban on Pakistan International Airlines (PIA), which he said had impacted the airline’s ability to attract international bids.

Read next: November inflation declines to 4.9 per cent, within SBP’s target range