• Market expert calls GDP rebound “remarkable improvement”.
• FY25 GDP growth expected between 2.5 %% 3.0%.
• SBP cuts the policy rate to 11% in the middle of ease of inflation.
  

Karachi: The Pakistani economy has crossed a symbolic threshold in which nominal GDP surpasses $ 400 billion for the first time, according to preliminary estimates approved by the National Accounts Committee (NAC).

The committee expected GDP growth of 2.68% for the current financial year and took the size of the economy to RS114.7 trillion (about $ 411 billion).

In his post on LinkedIn, Sohail Mohammed, CEO of brokerage firm Topline Securities, described it as a “remarkable improvement” in the middle of sustained macroeconomic headwinds. He emphasized that the nominal GDP in the US Dollar terms has grown with a composite annual growth rate (CAGR) of 9.3% over the past five years.

The government has set a long-term goal of becoming a $ 1 trillion economy of FY2035-a goal, as Mohammed says, will require “sustained structural reforms, political stability and disciplined external account management.”

National Accounting Data released on Tuesday shows the economy expanding from RS105.1 trillion in FY24 to RS114.7 trillion in FY25 – equivalent to an increase of $ 372 billion to $ 411 billion. Quarterly growth estimates were also revised upwards, with GDP rising 1.37% in 1st quarter and 1.53% in 2nd quarter.

Despite the improvement, the FY25 growth estimate does not fall below the government’s original target of 3.6%. Topline Securities sets an average quarterly growth in the first nine months of approx. 1.8%. Sector -level data reflects mixed performance: Agriculture grew 1.18% in 3rd quarter despite a downturn in key crops, while industrial production gained 1.14% due to decreases in mining, quarry and large -scale production.

In an attempt to support the recovery, the State Bank of Pakistan lowered its political rate by 100 basic points to 11% this month. The easing cycle resumed after a short break in March, with the central bank citing a more favorable inflation view.

Topline expects the entire year GDP will come between 2.5%and 3.0%, with agriculture expanding by 1.8%, the industry by 1.0%and services by 3.4%. Meanwhile, the IMF recently trimmed its own forecast for Pakistan’s FY25 GDP growth to 2.6%, down from a previous estimate of 3.2%.

Signs of softening demand in manufacture also arose where the HBL Pakistan Manufacturing Chaning Managers Index (PMI) eased to 51.9 in April from 52.7 the previous month, reflecting broader uncertainty about global trading conditions.