Pakistan's inflation eased slightly in June 2025, providing a measure of relief for policymakers grappling with geopolitical challenges. The Consumer Price Index (CPI) rose by 3.2% in June from a year earlier, according to data released by the Pakistan Bureau of Statistics. This figure was in line with the median estimate in a Bloomberg survey of economists. In comparison, inflation had quickened to 3.5% in May.
This moderation in inflation is a positive development for authorities seeking to bolster the economy amid ongoing external pressures. The central bank has been closely monitoring inflationary trends, and the easing in June's figures may influence future monetary policy decisions. The central bank had previously kept its target rate unchanged at 11% in its last meeting.
Despite the easing, policymakers remain vigilant due to persistent underlying inflationary pressures from factors like energy price shocks and their second-round effects on transport and production costs. While volatile components like fuel and some perishable foods provided some relief in June, core inflation remains a concern, indicating that a sustained return to the State Bank of Pakistan's 5-7% medium-term target will be gradual.
