Islamabad 1 August: Pakistan’s headline inflation rose to 4.1% year-on-year (YoY) in July 2025, up from 3.2% in June, according to data released by the Pakistan Bureau of Statistics (PBS) on Thursday. Despite the uptick, inflation remains comfortably within the government’s forecasted range of 3.5% to 4.5% for the fiscal year.
On a month-on-month (MoM) basis, prices surged by 2.9% in July, a notable jump from June’s modest 0.2% increase. Urban areas saw inflation rise to 4.4% YoY and 3.4% MoM, while rural inflation stood at 3.5% YoY and 2.2% MoM.
Analysts attribute the rise primarily to seasonal factors and adjustments in food and energy prices. However, they note that the current reading is significantly lower than July 2024’s 11.1% inflation, underscoring the impact of improved supply chains, stable exchange rates, and reduced global commodity pressures.
“The inflation trajectory remains broadly in line with expectations,” said an official from the Ministry of Finance. “Stable administrative pricing and better domestic harvests have helped anchor inflationary pressures.”
Economists caution that further price shocks could emerge if energy tariffs are adjusted or global oil prices rise. However, for now, inflation appears under control and unlikely to trigger major policy shifts by the State Bank of Pakistan in the near term.
The central bank is scheduled to review its monetary policy later this month.
| Indicator | June 2025 | July 2025 |
|---|
| Headline CPI inflation (YoY) | 3.2 % | 4.1 % |
| Headline CPI inflation (MoM) | 0.2 % | 2.9 % |
| Food inflation (YoY) | 2.56 % |
