Pakistan’s headline inflation slowed to 3.2% year-on-year in June 2025, down from 3.5% in May — marking the lowest level in nearly four years, according to the Pakistan Bureau of Statistics.
On a monthly basis, inflation rose slightly by 0.2%, compared to a 0.5% gain in May. The average Consumer Price Index (CPI) for Fiscal Year 2024–25 settled at 4.49%, a dramatic decline from the 23.41% average recorded in FY24.
This also marks the lowest annual inflation average since FY2016, when it stood at 2.9%.
Urban inflation was reported at 3.0% in June, while rural inflation registered at 3.6% — both sharply lower than the same period last year. The Sensitive Price Index (SPI), which reflects changes in essential household items, showed a 1.9% year-on-year drop.
Meanwhile, the Wholesale Price Index (WPI) edged up 0.6% year-on-year in June, indicating relative stability in bulk pricing.
This cooling of inflation is being credited to a stronger rupee, softer international commodity prices, better domestic food supply, and disciplined monetary policy. These factors may build the case for interest rate cuts in upcoming central bank decisions.
Still, analysts caution that challenges remain, particularly fiscal pressures, future energy price adjustments, and global market volatility.
