Pakistan inflation has been decreasing, and experts project that it may fall below 3% in January 2025. This decline is considered a positive sign for the country’s economy, raising hopes for a further reduction in the central bank’s policy rate.
| Heading | Details |
|---|---|
| Expected Inflation for January | Inflation may drop to 2.8% to 2.9%. |
| Comparison with Last Year | A significant drop from January 2024’s 28.3%. |
Inflation Projections for January 2025
Experts from JS Global and Ismail Iqbal Securities predict a continued drop in inflation. JS Global forecasts inflation to fall to 2.8% in January, the lowest since 2015. Despite a slight month-on-month increase, the overall trend remains downward.
| Heading | Details |
|---|---|
| JS Global’s Projection | Inflation expected at 2.8%. |
| Ismail Iqbal’s Estimate | Inflation projected at 2.9%. |
Impact of Declining Inflation on Policy Rate
The consistent decline in inflation could lead to further cuts in the central bank’s policy rate. Both JS Global and Ismail Iqbal Securities predict a 100 basis points reduction in the upcoming policy review.
| Heading | Details |
|---|---|
| Expected Rate Cut | A 100 basis points cut is forecast. |
| Monetary Policy Impact | Aims to stimulate economic recovery. |
Recent Inflation Data: December 2024
In December 2024, inflation was recorded at 4.1%, a decrease from November’s 4.9%. This shows a consistent decline in inflation, which is a positive sign for the economy and reinforces the possibility of a policy rate cut.
| Heading | Details |
|---|---|
| Inflation in December 2024 | 4.1% year-on-year. |
| Comparison with November | 4.9% in November 2024. |
Monetary Policy Outlook
Since June 2024, the central bank has reduced the policy rate by 900 basis points. In December, the rate was cut by 200 basis points to 13%. Experts expect another rate cut in the upcoming policy meeting to support economic growth.
| Heading | Details |
|---|---|
| Rate Cuts Since June 2024 | 900 basis points reduced. |
| Latest Rate | 13% after December cut. |
Positive Economic Outlook
The consistent decline in inflation raises hopes for continued economic stability. While inflation may rise again later in 2025, the current trend provides room for further policy rate cuts, helping support economic growth.
| Heading | Details |
|---|---|
| Outlook for 2025 | Continued rate cuts are possible. |
| Future Inflation Concerns | Inflation pressures may return by May 2025. |
