KARACHI – The inflation witnessed a sharp downward trend, hitting a 9-year low at 2.4 per cent in January 2025 amid decrease in prices of basic commodities. The fresh figures indicate positive shift towards stabilizing prices, offering some relief after a period of soaring inflation.
Data shared by Pakistan Bureau of Statistics (PBS) shows the inflation rate for January 2025 moving down to 2.4pc on a year-on-year basis, lower than the 4.1pc recorded in December 2024. On a month-on-month basis, the Consumer Price Index (CPI) saw slight uptick but marked improvement from 1.8pc increase in January 2024.
It was linked to drop in inflation to high base effect and cut in edible prices, with overall CPI for first 7-months of FY-2024-25 averaging 6.5pc, a sharp decline from 28.73pc during same period last year. The downward trend follows a period of high inflation, including a record peak of 38% in May 2023.
Finance Division credited successful policy interventions and administrative actions for controlling inflation and reducing the prices of essential goods.
The development comes amid drop in key policy rate by 100 basis points to 12pc, marking sixth consecutive rate cut in this fiscal year. The central bank chief indicated that inflation would continue to ease in January, but may rise slightly in the coming months.
Inflation trends in urban and rural areas also reflected significant changes. Urban inflation dropped to 2.7% year-on-year in January 2025, down from 4.4% in December 2024 and 30.2% in January 2024. Rural inflation decreased to 1.9% year-on-year in January 2025, from 3.6% in December 2024 and 25.7% in January 2024.
State bank of Pakistan cuts key Policy Rate by 100bps, sixth in a row
