Inflation rate sinks to its lowest level at 4.9% in 6.5 years

The annual consumer price index (CPI) for the month of November declined to 4.9 percent, marking 6.5 years’ lowest rate, according to the Pakistan Bureau of Statistics (PBS).

From the peak of 38 percent, the inflation rate has been declining consecutively for months, leading to a cut in the monetary policy rate to 15 percent. 

Topline Securities, a Karachi-based brokerage firm, described the latest inflation figure as the 'lowest reading in 78 months'. Notably, the average inflation rate for the first five months of FY25 (5MFY25) stood at 7.88%, significantly lower than the 28.62% recorded during the same period in FY24 (5MFY24).

According to statistics shared by PBS, the inflation rate reduced to 4.9 percent year-on-year, was 7.2 percent last month and 29.3 percent in November 2023.

However, a slight 0.5 percent increase was seen month-on-month (MoM) in November, as compared to 1.2 percent in the previous month.

It should be noted that the SBP had eased the monetary policy to bring inflation down to the target of 5- 7 percent by September 2025 and ensure macroeconomic stability. 

Prices increased on year-on-year food items, included Pulse Gram, Besan, Pulse Moong, Fish, Gram Whole, Milk Powder, and Meat.

Motor Vehicle Tax, Footwear, Dental Services, Personal Effects, and Woolen Readymade Garments’ prices were increased in non-food items.