- Ramazan-driven demand pressures household budgets and essential commodity prices
Presently the government of Pakistan strictly continues to monitor price fluctuations as inflation trends impact household budgets during the holy month of Ramazan in 2025. Statistics showed that inflation rises by 0.22 percent in second week of Ramazan, with prices of 12 essential items, including live broiler chicken, tomatoes, and sugar, witnessing a surge. As per the Pakistan Bureau of Statistics (PBS), inflation on an annual basis recorded a fall of 1.97 percent for the week ending March 13, 2025.
| Core Inflation In Pakistan (%) (Base 2015-16) | ||||||||
|---|---|---|---|---|---|---|---|---|
| Periods | NFNE | Trimmed | ||||||
| Urban | Rural | Urban | Rural | |||||
| YoY | MoM | YoY | MoM | YoY | MoM | YoY | MoM | |
| Feb-2024 | 15.5 | 0.3 | 21.9 | 0.4 | 16.0 | 0.3 | 21.3 | 0.4 |
| Mar-2024 | 12.8 | 0.1 | 20.0 | 0.8 | 14.8 | 0.6 | 18.4 | 0.9 |
| Apr- 2024 | 13.1 | 2.1 | 19.3 | 2.0 | 13.4 | 0.5 | 15.0 | 0.6 |
| May- 2024 | 12.3 | 0.4 | 17.0 | 0.5 | 11.0 | -0.5 | 10.6 | -0.9 |
| June- 2024 | 12.2 | 0.6 | 17.0 | 0.9 | 10.3 | 0.6 | 11.0 | 0.5 |
| July- 2024 | 11.7 | 0.7 | 16.9 | 1.1 | 10.3 | 1.2 | 11.3 | 1.7 |
| Aug-2024 | 10.2 | 0.4 | 14.4 | 0.6 | 8.0 | 0.2 | 9.6 | 0.4 |
| Sep-2024 | 9.3 | 0.2 | 12.1 | 0.5 | 7.1 | -0.1 | 7.4 | -0.1 |
| Oct-2024 | 8.6 | 0.6 | 11.7 | 0.7 | 6.4 | 0.7 | 7.2 | 1.0 |
| Nov-2024 | 8.9 | 1.2 | 10.9 | 0.7 | 7.5 | 0.6 | 7.8 | 0.5 |
| Dec-2024 | 8.1 | 0.2 | 10.7 | 0.6 | 6.2 | 0.1 | 6.5 | 0.6 |
| Jan-2025 | 7.8 | 0.8 | 10.4 | 0.9 | 5.4 | 0.6 | 5.4 | 0.7 |
| Feb-2025 | 7.8 | 0.3 | 10.4 | 0.4 | 4.6 | 0.1 | 5.2 | 0.1 |
The government of Pakistan registered that country’s headline inflation is expected to stay within the 2 to 3 percent range in February and may increase to 3 to 4 percent by March. In January, in line with expectations, the Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) reduced the key policy rate by 100 basis points (bps), taking it down to 12 percent. This was the sixth successive cut in the key interest rate since June 2024 when it stood at 22 percent. After the policy rate decision, SBP official analyzed that inflation would ease further in January before inching up in the subsequent months.
No doubt, Inflation has become the most significant economic challenge especially in the holy month of Ramazan in Pakistan. Inflation in our country was mainly driven by a gap between demand and supply, caused by excessive demand for goods and services compared to supply. This was influenced by increased government spending and growing consumer demand. Additionally, factors such as rising energy prices, higher import costs, and wage pressures contributed to inflation.
CPI inflation General, declined to 1.5 percent on year-on-year (YoY) basis in February 2025 as against to 2.4 percent in the previous month and 23.1 percent in February 2024. On month-on-month (MoM) basis, it declined by 0.8 percent in February 2025 as against to an increase of 0.2 percent in the previous month and no change in February 2024.
CPI inflation Urban, declined to 1.8 percent on (YoY) basis in February 2025 as compared to 2.7 percent in the previous month and 24.9 percent in February 2024. On (MoM) basis, it fell by 0.7 percent in February 2025 as against to an increase of 0.2 percent in the previous and same month of last year i.e. February 2024.
CPI inflation Rural, declined to 1.1 percent on (YoY) basis in February 2025 as compared to 1.9 percent in the previous month and 20.5 percent in February 2024. On (MoM) basis, it declined by 1.1 percent in February 2025 as against to an increase of 0.2 percent in the previous month and a decline of 0.3 percent in February 2024.
SPI inflation on (YoY) fell to 0.2 percent in February 2025 as against to 0.7 percent a month earlier and 30.4 percent in February 2024. On (MoM) basis, it fell by 1.6 percent in February 2025 as against to a fall of 1.4 percent a month earlier and a decrease of 0.8 percent in February 2024.
WPI inflation on (YoY) basis declined to 0.7 percent in February 2025 as against to 0.6 percent a month earlier and a rise of 18.7 percent in February 2024. On (MoM) basis, it decreased by 0.2 percent in February 2025 as against to a rise of 0.2 percent in the previous month and 1.1 percent change was observed in corresponding month of last year i.e. February 2024.
Core Inflation (Nfne)
Measured by non-food non-energy Urban stayed stable at 7.8 percent on (YoY) basis in February 2025 as against to the previous month and an increase of 15.5 percent in February 2024. On (MoM) basis, it increased by 0.3 percent in February 2025 as against to 0.8 percent in previous month and a rise of 0.3 percent in the same month of last year i.e. February, 2024.
Measured by non-food non-energy Rural also stayed equal at 10.4 percent on (YoY) basis in February 2025 as against to the previous month and 21.9 percent in February 2024. On (MoM) basis, it increased by 0.4 percent in February 2025 as against to a rise of 0.9 percent in previous month and an increase of 0.4 percent in the same month of last year i.e. February 2024.
Core Inflation (Trimmed)
Measured by 20 percent weighted trimmed mean Urban decreased to 4.6 percent on (YoY) basis in February 2025 as compared to 5.4 percent in the previous month and 16.0 percent in February 2024. On (MoM) basis, it increased by 0.1 percent in February 2025 as compared to an increase of 0.6 percent in the previous month and an increase of 0.3 percent in corresponding month of last year i.e. February 2024.
Measured by 20 percent weighted trimmed mean Rural declined to 5.2 percent on (YoY) basis in February 2025 as compared 5.4 percent in the previous month and 21.3 percent in February 2024. On (MoM) basis, it grew by 0.1 percent in February 2025 as compared an increase of 0.7 percent in the previous month and an increase of 0.4 percent in corresponding month of last year i.e. February 2024.