• Finance department’s report link food, energy prices for inflation falls.
• “Financial policy consolidation measures produce concrete results,” it says.
• Highlights the resilience of the economy, stability of fiscal, external fronts.

Islamabad: Continued its stable trend, Pakistan’s Consumer Price Index (CPI) – -based inflation is expected to hover between 1-1.5% in March 2025 with permission from ease in inflation pressure.

According to the statistics released by financial divisions in its “Financial Update and Outlook March 2025” report, CPI inflation was registered to 1.5% on a yoy base in February 2025 compared to 2.4% in the previous month and 23.1% in February 2024.

On a morasis, it fell by 0.8% compared to an increase of 0.2% in the previous month. However, the most important indicator is likely to witness an increase and is expected to hover about 2-3% in April.

In highlighting that the country’s economy demonstrated resilience and stability of fiscal and external fronts, the report emphasized that the inflation pressure is relieved, supported by declining food and energy prices, promoting overall price stability.

“Financial policy consolidation measures produce concrete results, leading to a primary surplus and a narrowed tax deficit,” it said.

By associating the decrease in food and energy prices to the fall in inflation, the report said that larger drivers contributing to the Yoy rise in CPI includes health (14.3%), clothing and footwear (13.8%), education (10.9%), restaurants and hotel (7.6%), alcoholic drink

Meanwhile, a decrease in perishable foods (20.3%), non-perishable foods (1.5%), transport (1.1%) and homes, water, electricity, gas and fuels (0.6%) were observed.

In its report, brokerage firm Topline Securities estimates that the country’s CPI for the current month is expected to fall to a low low decade that detects between 0.5% and 1% year with a monthly increase of 0.9%.

In that case, this would bring the average inflation for the first nine months of FY25 to 5.38%, a sharp decline from 27.06% registered in the same period last year.

Prime minister Shehbaz Sharif-led government has said its $ 350 billion economy has stabilized under an international monetary (IMF) $ 7 billion (IMF), which had helped prevent a standard threat.

Islamabad is awaiting an IMF agreement on the first review of Bailout, which, if approved, will pay $ 1 billion in front of the country’s annual budget, which is usually presented in June.

Inflation in the South Asian country has fallen for several months after it rose to about 40% in May 2023.

An increase in exports and transfers also lifts Pakistan’s external financing requirements, which are already supported by IMF rescue and rollovers of bilateral loans from friendly countries, the report said.

Transfers are likely to increase further due to seasonal factors, such as the Holy Month Ramadan, and Eid Ul Fitr, which follows when Pakistani workers abroad typically send extra money to families at home.

– Further input from Reuters