Pakistan inflation to ease further in November 2024, says Ministry of Finance

Pakistan’s headline inflation is expected to stay within the 5.8-6.8% range in November and decline further to 5.6-6.5% by December, the Finance Division projected on Wednesday.

In its ‘Monthly Economic Update and Outlook’, the ministry said that fiscal consolidation and contained inflation will provide impetus to economic activities in the coming months.

“Inflation is expected to remain within the range of 5.8% - 6.8% in November, further receding to 5.6% - 6.5% by December 2024,” read the report.

Inflation in Pakistan has been a significant and persistent economic challenge. In May of last year, the CPI inflation rate hit a record high of 38%. However, it has been on a downward trajectory since then.

Pakistan’s headline inflation clocked in at 7.2% on a year-on-year basis in October 2024, slightly higher than the reading in September 2024 when it stood at 6.9%, revealed Pakistan Bureau of Statistics (PBS) data.

Pakistan’s inflation likely to slow down further in November, signals room for another rate cut

Agriculture

As per the report, the real sector the economy continues to get support from agriculture and industrial sector policies.

“On the agriculture front, wheat crop sowing is in progress to achieve the targeted area and production. The government facilitations are well intact regarding the timely provision of key inputs to the farmers at reasonable prices,” it said.

Large-scale manufacturing

Meanwhile, the report highlighted that large-scale manufacturing (LSM) indicators highlight a sector striving to recover.

“Although YoY growth remains negative, MoM performance shows signs of resilience, with gradual production increases in key sectors such as textile and automobiles,” stated the report.

The ministry expressed that continued policy support and external stability would provide a foundation for sustained improvement, suggesting a cautiously optimistic outlook for progressive recovery.

External front

The ministry in its latest report highlighted that the current account turned into a surplus during Jul-Oct FY2025, bolstering external sector sustainability.

“For the outlook, it is anticipated that exports, imports, and worker’s remittances will continue to observe their increasing trend - exports will remain within a range of $2.5-3.0 billion, imports $4.5-4.9 billion, and worker’s remittances $2.8-3.3 billion in November 2024,” it said.