ISLAMABAD: A Pakistani market research organization on Wednesday estimated a further decline in inflation in the ongoing month, projecting it to fall below 1%, marking the lowest monthly year-on-year (YoY) reading in over three decades.
Topline Pakistan Research, a division of Topline Securities, a prominent brokerage house in Pakistan, gathers and analyzes market data along with consumer behavior and socio-economic indicators.
In recent years, Pakistan has grappled with high inflation, with consumer prices reaching a record 38% in May 2023. However, subsequent monetary policy measures and a series of economic reforms led to a substantial decline, bringing the annual inflation rate down to 1.5% in February 2025.
“Pakistan’s Consumer Price Index (CPI) for Mar 2025 is expected to bottom out and clock in at 0.5-1.0% YoY (+0.9 percent MoM), lowest monthly YoY reading in over 3 decades, taking 9MFY25 average to 5.38% compared to 27.06% in 9MFY24,” Topline Pakistan Research stated in its estimate.
It noted the anticipated decline in March 2025’s CPI was likely to follow a 2.3% reduction in electricity prices, resulting from a higher fuel cost adjustment of Rs2 per kilowatt hour (kWh) compared to Rs1/kWh in the previous month.
The transport segment index is also expected to decrease by 0.7% month-on-month, owing to a decline in diesel and petrol prices by an average of 2%.
Given these developments, Topline Pakistan Research said it was also revising its inflation forecast for fiscal year 2025 downward from 6-7% to 5-6%.
With the expected inflation rate of less than 1 percent for March 2025, the research organization said the real interest rates will be significantly higher than Pakistan’s historic average of 200-300 basis points, standing at 1,100-1,150 basis points. However, based on fiscal year 2026 inflation estimates of 8-9%, real rates are projected to be 300-400 basis points positive.
Topline Pakistan Research also cautioned any major deviation in commodity rates from current levels, especially fuel prices, could result in change in inflation estimates.
Pakistan March inflation to drop below 1% — market analysis
https://arab.news/2duzt
Pakistan March inflation to drop below 1% — market analysis
- Topline Pakistan Research says the decline may mark the lowest level in over three decades
- The research firm cautions any major deviation in commodity prices will impact the inflation rate
Global trade isn’t deglobalizing — it’s reshuffling, Harvard economist says
ALULA: Global trade is not retreating into deglobalization despite geopolitical shocks, but is instead undergoing a structural reshuffling led by US-China tensions, according to Harvard University economist Pol Antras.
Presenting research at the AlUla Emerging Market Economies Conference, Antras said there is no evidence that countries are systematically turning inward. Instead, trade flows are being redirected across markets, creating winners and losers depending on export structure and exposure to Chinese competition.
This comes as debate intensifies over whether supply-chain disruptions, industrial policy and rising trade barriers signal the end of globalization after decades of expansion.
Speaking to Arab News on the sidelines of the event, Antras said: “I think the right way to view it is more a reorganization, where things are moving from some countries to others rather than a general trend where countries are becoming more inward looking, in a sense of producers selling more of their stuff domestically than internationally, or consumers buying more domestic products than foreign products.”
He said a change of that scale has not yet happened, which is important to recognize when navigating the reshuffling — a shift his research shows is driven by Chinese producers redirecting sales away from the US toward other economies.
He added that countries are affected differently, but highlighted that the Kingdom’s position is relatively positive, stating: “In the case of Saudi Arabia, for instance, its export structure, what it exports, is very different than what China exports, so in that sense it’s better positioned so suffer less negative consequences of recent events.”
He went on to say that economies likely to be more negatively impacted than the Kingdom would be those with more producers in sectors exposed to Chinese competition. He added that while many countries may feel inclined to follow the United States’ footsteps by implementing their own tariffs, he would advise against such a move.
Instead, he pointed to supporting producers facing the shock as a better way to protect and prepare economies, describing it as a key step toward building resilience — a view Professor Antras underscored as fundamental.
Elaborating on the Kingdom’s position amid rising tensions and structural reorganization, he said Saudi Arabia holds a relative advantage in its economic framework.
“Saudi Arabia should not be too worried about facing increased competitive pressures in selling its exports to other markets, by its nature. On the other hand, there is a benefit of the current situation, which is when Chinese producers find it hard to sell in US market, they naturally pivot to other markets.”
He said that pivot could benefit importing economies, including Saudi Arabia, by lowering Chinese export prices. The shift could increase the Kingdom’s import volumes from China while easing cost pressures for domestic producers.
