Pakistani markets gear up for Ramazan boom despite inflation woes

As Ramazan falls next month, consumer spending in Pakistan is expected to peak in March this year. Like in many Muslim-majority countries, household expenditures typically surge during the holy month, driven by increased spending on food, charitable giving and Eid shopping.

Pakistani civil servants in planning and finance ministries privately discuss consumer market dynamics but are reluctant to offer an official stance. Despite a significant hike in market activity during Ramadan, no formal effort has been made to gauge its scale, assess regional variations, identify key drivers and trends, or analyze shifting consumption patterns during this period.

Economists, whether working for the government, academia, elite consultancies or global development agencies, tend to focus on areas where systematic data is readily available for their models. Unpopular or niche subjects within their local and global circles are often overlooked. If any academic research work has been conducted on such topics, it is either not publicly accessible or unavailable online. While some economists are open to discussion, they often have little to offer beyond broad and generalized observations.    

Pakistan’s monthly inflation at 9-year low; weekly at 7-year low

Traders, manufacturers, marketing experts and bankers confirm a significant surge in market activity during Ramazan. “It’s all in the open. While offices experience a slowdown, markets and malls are buzzing with activity. From wholesalers to retailers, high-end shopping malls to neighbourhood stores, numerous brands roll out special packages and promotions. Meanwhile, customers seeking convenience are increasingly turning to online shopping and digital payments to avoid the hassles of crowded markets,” observed a market insider.

Actively capitalizing on the increased market presence of customers and suppliers, including manufacturers, importers and traders, strategize to maximise the opportunity by building inventories to match higher demand. They engage specialised marketing experts to analyze popular trends and adjust their offerings accordingly. In addition to conventional advertising, dedicated budgets are allocated for social media promotions, targeting youth and women, who play a pivotal role in shaping consumer demand, particularly during this period.

All Pakistan Anjuman-e-Tajiran President Ajmal Baloch anticipates a moderate surge in demand this year due to prolonged economic strain on a majority of the population. “Market expansion is directly tied to citizens’ disposable income and its purchasing power. For years, working families have faced stagnant incomes while inflation has eroded their value. The desire to provide more and better for their families remains, but affordability is the real challenge. Even retailers are struggling, as their working capital is no longer sufficient to sustain business operations,” he said.

Mehr Illahi, a leader of Peshawar Chamber of Small Traders and former special assistant to the chief minister Khyber Pakhtunkhwa, projected at least 20 per cent increase in consumer demand during Ramazan this year.

“In my province, almost all adults and even children as young as 12, observe fasting regularly. Even families with limited means make an effort to stretch their kitchen budget to include Ramazan specialties at Sehr and Iftar. As a result, spending on food and beverages sees a definite rise during this month,” he remarked. 

Moinuddin, former senior research economist at the State Bank and Chief Executive, The Compliance Training and Consultancy, believes that consumer demand in Pakistan indeed peaks during Ramazan. “This projection is well supported by various economic and social indicators. For instance, cash withdrawals, workers’ remittances and retail sales see a significant surge, along with an increase in charitable donations, both in cash and kind. Conversely, bank deposits tend to decline. In my estimation, the rise in consumer spending could be anywhere between 30 to 40 per cent,” he said. 

Another banker also estimated 40 per cent increase in household spending during Ramazan, regardless of its placement in the solar calendar. In 2025, Ramazan coincides with March.

“Yes, I agree that family expenditures peak during Ramazan in Pakistan. The kitchen budget rises due to higher consumption of premium food items, including milk and dairy-based products, desserts, and sweet beverages, compounded by their elevated prices.

“Additionally, with Eid approaching and increased social interaction expected, families allocate funds for home improvements, boosting sales of household items such as furniture and appliances. Charitable giving also sees a sharp rise during Ramazan. However, this year, per capita donations may decline as prolonged economic stress has pushed many previous donors into the category of recipients.