Finance

Pakistan Inflation Rate Drops Sharply in FY2025

ISLAMABAD: The Pakistan inflation rate for FY2025 dropped significantly to 4.49%, compared to a staggering 23.21% in fiscal year 2023-24, according to fresh data released by the Pakistan Bureau of Statistics (PBS).

The latest PBS report highlighted that the Consumer Price Index (CPI) based inflation stood at 3.2% year-on-year (YoY) in June 2025, down from 3.5% a month earlier and markedly lower than the 12.6% recorded in June 2024.

On a month-on-month (MoM) basis, CPI inflation edged up by 0.2% in June, reversing a 0.2% decline in May and lower than the 0.5% rise seen in June last year.

Breaking down the figures, urban CPI inflation decreased to 3.0% YoY in June 2025, compared to 3.5% in May and 14.9% a year ago. MoM, it held steady at 0.1%.

Meanwhile, rural CPI inflation increased to 3.6% YoY in June, slightly above May’s 3.4% but still well below June 2024’s 9.3%. On a monthly basis, rural inflation rose by 0.5%, after declining by 0.5% in the previous month.

SPI, WPI, and Core Inflation Also Reflect Easing Trend

Sensitive Price Index (SPI) inflation fell by 1.9% YoY in June 2025, compared to a 0.6% decrease in May and a surge of 16.6% in June last year. There was no MoM change, following a 1.0% drop the previous month.

Wholesale Price Index (WPI) inflation ticked up slightly to 0.6% YoY in June from 0.4% in May, much lower than the 10.6% posted in June 2024. On a monthly basis, WPI also rose by 0.6%.

Core inflation measured by non-food non-energy (NFNE) for urban areas fell to 6.9% YoY in June, down from 7.3% in May and 12.2% a year ago. MoM, it rose by 0.2%. Rural core NFNE eased to 8.6% YoY from 8.8% in May and 17.0% last June, with a 0.7% MoM uptick.

Trimmed mean core inflation showed a similar trend. Urban trimmed mean fell to 4.7% YoY from 4.9% in May and 10.3% last year, while rural increased to 5.2% from 4.7% in May. MoM, urban rose by 0.3% and rural by 0.5%.

The sharp moderation in the Pakistan inflation rate FY2025 signals an easing of price pressures across key sectors, offering some relief to consumers after two years of elevated inflation.