ISLAMABAD: Pakistan’s Finance Division said this week that inflation is expected to remain in the 8-9% range from September to October, adding that the country’s economic recovery will be bolstered by a favorable external economic environment and a stable exchange rate.
Pakistan’s annual consumer price inflation (CPI) rate eased to 9.6% in August, the first single-digit reading in almost three years. Islamabad undertook tough economic measures which included increasing taxes and electricity prices, to enter into a $7 billion loan agreement with the International Monetary Fund (IMF) which was formally approved on Wednesday.
However, inflation has been on a downward trend in the country which peaked at 38% in May 2023. Pakistan’s August annual CPI figures were clocked at 27.4% in August 2023 and 11.1% in July 2024. The government has credited its tough reforms and economic policies for the declining trend of inflation.
“Inflation is expected to remain within the range of 8.0% to 9.0% in September and October 2024,” the Finance Division’s monthly Economic Outlook report for September 2024 said on Friday.
The report said that Pakistan’s exports and imports are expected to observe an increase in momentum, with exports expected to remain in the range of $ 2.5-3 billion while imports will remain in the $4.5-5 billion range in September.
It said workers’ remittances were expected to remain in the $ 2.7-3.2 billion range this month.
The report said that Pakistan’s external account had improved at the back of increased workers remittances and surging exports.
“During Jul-Aug FY2025, the current account registered a deficit of $ 0.2 billion compared to $ 0.9 billion last year however, it recorded a surplus of $ 75 million in August 2024,” the report said.
The report pointed out that from July to August, goods exports increased by 7.2 percent to reach $4.9 billion while imports stood at $ 9.5 billion compared to $ 8.4 billion last year, leading to a trade deficit of $ 4.7 billion.
