ISLAMABAD: Pakistan’s central bank chief said on Thursday that the country will experience fluctuations in inflation in the next four to five months before it stabilizes within the five to seven percent range toward the end of the year.
Pakistan’s consumer inflation rate slowed to 4.1 percent year-on-year in December 2024. The reductions came at the back of the State Bank of Pakistan’s (SBP) move to cut the key policy rate by 200 basis points to 13 percent in December, the fifth straight reduction since June, bringing cumulative rate cuts for 2024 to 900 basis points.
The reduction in the inflation rate has brought some relief for the masses, which bore the brunt of record high inflation which peaked at 38 percent in May 2023, as Pakistan faced a prolonged economic crisis.
“At the moment it [inflation] has decreased a lot and in the month of January, it will come down a bit further but will then witness fluctuation later,” SBP Governor Dr. Jameel Ahmed said at a news conference.
“But as per our [central bank’s] assessment by the end of 2025, it will stabilize within the target range of five to seven percent, according to the medium-term target by the state bank and the government of Pakistan,” he added.
Ahmed said a collective effort to achieve the medium-term target of five to seven percent will bring relief to Pakistani businesses and the common man.
“But god forbid if there is any volatility in this which we are unable to control then we have seen the disruptions caused to businesses and even the common man in the past,” he said.
The South Asian country is navigating a challenging economic recovery path buttressed by a $7 billion facility from the International Monetary Fund granted in September.
Pakistan’s finance minister has lauded the government’s fiscal measures but warned that the country needs long-term financial reforms to ensure sustainable growth and avoid future IMF bailout programs.
Pakistan central bank chief expects inflation rate to fluctuate in coming months
https://arab.news/6u9g4
Pakistan central bank chief expects inflation rate to fluctuate in coming months
- Inflation rate to stabilize within 5-7 percent range by end of 2025, says central bank governor
- Pakistan’s inflation rate slowed to 4.1 percent in December after aggressive policy rate cuts by state bank
Pakistani stocks breach 176,000 points barrier as investors expect further rate cuts
- Pakistani financial analyst attributes surge to falling inflation, investors expecting further policy rate cuts
- Pakistan’s finance ministry said Thursday that inflation had slowed to 5.6 percent year-on-year in December
KARACHI: Pakistani stocks continued their bullish run on Thursday, breaching the 176,000 points barrier for the first time after trading ended, with analysts attributing the surge to investors expecting further cuts in the policy rate.
The KSE-100 benchmark gained 2,301.17 points at close of business on Thursday, marking an increase of 1.32 percent to settle at 176,355.49 points.
Pakistan’s central bank cut its key policy rate by 50 basis points to 10.5 percent last month, breaking a four-meeting hold in a move that surprised markets. Pakistan’s consumer price inflation slowed to 5.6 percent year-on-year in December, while prices fell on a monthly basis as per data from the finance ministry.
“Upbeat data for consumer price index (CPI) inflation at 5.6pc in December 2025 [with] investors expecting a further State Bank of Pakistan rate cuts on falling inflation data,” Ahsan Mehanti, CEO of Arif Habib Commodities Ltd., told Arab News.
The stock market witnessed a trading volume of 1,402.650 million shares, with a traded value of Rs48.424 billion ($173 million), compared with 957.239 million shares valued at Rs44.231 billion ($158 million) during the previous session.
Topline Securities, a leading brokerage firm in Pakistan, credited the surge to strong buying at the first session.
“This positivity can be accredited to buying by local institutions on the start of the new calendar year,” it said.
Pakistan’s Finance Adviser Khurram Schehzad highlighted that the bullish trend at the stock market reflected “strong investor confidence.”
“With lower inflation, affordable fuel, stronger reserves, rising digitization and a buoyant capital market, Pakistan’s economic outlook is clearly improving--supporting greater confidence, better investment sentiment and more positive momentum for 2026,” he said on social media platform X.
