No doubt, economists are very interested in examining the relationship between inflation and economic growth. One of the main reasons behind this is the fact that the conduct of monetary policy is largely considered to have important consequences for long-term economic growth. Economic growth and inflationary relations have been closely monitored in the economy. When Inflation reaches a peak, it curbs productivity and growth whereas a low and stable inflation rate contributes to economic growth. The high inflation rate affects the decision making of almost all economic factors such as consumers, producers, and investors due to uncertainty about the expected consequences of their actions. High and sustained economic growth with low inflation is the central objective of the macroeconomic policy makers. Therefore, inflation has been one of the most researched topics in macroeconomics for the last many years because it has serious implications for growth and income distribution. In Pakistan, the policy makers and the State Bank of Pakistan keep the inflation rate stable and below the level which has been found helpful for the achievement of sustainable economic growth. It is said that moderate and stable inflation is also helpful for minimizing the fluctuations and uncertainties in the financial sector of economy, which, in turn, boost the capital formation activities in the country. So that it may exert its positive effects on the economy. So, maintaining price stability will ultimately be the best policy recommendation to stable and sustained economic growth of the economy. The government of Pakistan records the inflation rate in the following manners:
- CPI inflation General, grew by 10.9 percent on year-on-year (YoY) basis in April 2026 as compared to a rise of 7.3 percent in the last month and 0.3 percent in April 2025. On month-on-month (MoM) basis, it grew by 2.5 percent in April 2026 as against to an increase of 1.2 percent in the previous month and a fall of 0.8 percent in April 2025.
- CPI inflation Urban, grew by 11.1 percent on YoY basis in April 2026 as against to an increase of 7.4 percent in the previous month and an increase of 0.5 percent in April 2025. On MoM basis, it increased by 2.7 percent in April 2026 as against to an increase of 1.3 percent in the previous month and a fall of 0.7 percent in April 2025.
- CPI inflation Rural, grew by 10.6 percent on YoY basis in April 2026 as compared to an increase of 7.2 percent in the previous month and a decrease of 0.1 percent observed in April 2025. On MoM basis, it increased by 2.1 percent in April 2026 as compared to an increase of 1.0 percent in the previous month and a fall of 1.0 percent in April 2025.
- SPI inflation on YoY basis grew by 10.1 percent in April 2026 as compared to an increase of 5.6 percent in the previous month and a decrease of 3.6 percent in April 2025. On MoM basis, it increased by 2.0 percent in April 2026 as compared to an increase of 0.7 percent in the previous month and a fall of 2.1 percent in April 2025.
- WPI inflation on YoY basis increased by 13.6 percent in April 2026 as against to an increase of 6.7 percent in the previous month and a fall of 2.2 percent in April 2025. On MoM basis, it increased by 5.1 percent in April 2026 as compared to an increase of 5.9 percent in the previous month and a fall of 1.3 percent in April 2025.
- Measured by non-food non-energy Urban grew by 8.0 percent on YoY basis in April 2026 as compared to an increase of 7.4 percent in the previous month and 7.4 percent in April 2025. On MoM basis, it increased by 1.9 percent in April 2026 as against to 0.7 percent in previous month and an increase of 1.3 percent in the same month of last year i.e. April 2025.
- Measured by non-food non-energy Rural grew by 8.5 percent on YoY basis in April 2026 as compared to a rise of 8.4 percent in the previous month and an increase of 9.0 percent in April 2025. On MoM basis, it increased by 1.1 percent in April 2026 as compared to an increase of 0.8 percent in the previous month and an increase of 0.9 percent in the same month of last year i.e. April 2025.
- Measured by 20 percent weighted trimmed mean Urban increased by 9.2 percent on YoY basis in April 2026 as against to an increase of 5.9 percent in the previous month and 3.8 percent in April 2025. On MoM basis, it increased by 1.1 percent in April 2026 as compared to an increase of 0.6 percent a month earlier and a rise of 0.3 percent in the same month of last year i.e. April 2025.
- Measured by 20 percent weighted trimmed mean Rural grew by 8.9 percent on YoY basis in April 2026 as compared to an increase of 6.3 percent in the previous month and 3.3 percent in April 2025. On MoM basis, it grew by 1.0 percent in April 2026 as against to a rise of 0.5 percent in the previous month and a fall of 0.1 percent in the same month of last year i.e. April 2025.
| Pakistan: Period Average and Y-o-Y % Change | ||||||
|---|---|---|---|---|---|---|
| Index | Average July – April % Changes | April over April % Changes | ||||
| 2025-2026 | 2024-2025 | 2023-2024 | 2025-2026 | 2024-2025 | 2023-2024 | |
| CPI (National) | 6.19 | 4.73 | 25.97 | 10.89 | 0.28 | 17.34 |
| CPI (Urban) | 6.25 | 5.74 | 26.27 | 11.11 | 0.54 | 19.40 |
| CPI (Rural) | 6.10 | 3.29 | 25.55 | 10.56 | -0.10 | 14.46 |
| SPI | 4.12 | 4.85 | 30.17 | 10.06 | -3.59 | 21.64 |
| WPI | 2.31 | 2.18 | 22.37 | 13.57 | -2.20 | 13.88 |