Pakistan’s Consumer Price Index (CPI)-based inflation slowed to 2.41% year-on-year (YoY) in January 2025, marking a significant decline from 4.1% in December 2024 and 28.3% in January 2024, according to data released by the Pakistan Bureau of Statistics (PBS). This is the lowest inflation reading in 111 months (over 9 years), as noted by Topline Securities.

Inflation Trends

During the first seven months of FY25 (7MFY25), inflation averaged 6.5%, a sharp drop compared to 28.73% during the same period in FY24. The decline reflects easing price pressures across urban and rural areas.

• Urban CPI Inflation: Decreased to 2.7% YoY in January 2025, down from 4.4% in December 2024 and 30.2% in January 2024. On a month-on-month (MoM) basis, it rose slightly by 0.2% in January 2025, compared to a 0.1% decline in the previous month.
• Rural CPI Inflation: Dropped to 1.9% YoY in January 2025, compared to 3.6% in December 2024 and 25.7% in January 2024. On an MoM basis, it increased by 0.2%, slightly lower than the 0.3% rise in the previous month.

SPI and WPI Inflation

• Sensitive Price Index (SPI): SPI inflation fell to 0.7% YoY in January 2025, down from 4.2% in December 2024 and 36.2% in January 2024. On an MoM basis, it decreased by 1.4%, compared to a 0.8% decline in the previous month.
• Wholesale Price Index (WPI): WPI inflation dropped to 0.6% YoY in January 2025, compared to 1.9% in December 2024 and 27.0% in January 2024. On an MoM basis, it rose by 0.2%, reversing a 0.4% decline in the previous month.

Core Inflation

Core inflation, which excludes food and energy prices, also showed a downward trend:

• Urban Core Inflation (NFNE): Decreased to 7.8% YoY in January 2025, compared to 8.1% in December 2024 and 17.8% in January 2024. On an MoM basis, it rose by 0.8%, up from 0.2% in the previous month.
• Rural Core Inflation (NFNE): Dropped to 10.4% YoY in January 2025, compared to 10.7% in December 2024 and 24.6% in January 2024. On an MoM basis, it increased by 0.9%, compared to 0.6% in the previous month.

Trimmed Core Inflation

Measured by a 20% weighted trimmed mean:

• Urban Trimmed Core Inflation: Declined to 5.4% YoY in January 2025, compared to 6.2% in December 2024 and 22.1% in January 2024. On an MoM basis, it rose by 0.6%, up from 0.1% in the previous month.
• Rural Trimmed Core Inflation: Dropped to 5.4% YoY in January 2025, compared to 6.5% in December 2024 and 25.8% in January 2024. On an MoM basis, it increased by 0.7%, slightly higher than the 0.6% rise in the previous month.