Riaz Hussain :
ISLAMABAD – Pakistan’s inflation rate saw a significant slowdown in August 2025, according to fresh data released by the Pakistan Bureau of Statistics (PBS). The report highlights that core inflation dropped to 3 percent during the month, down from 4.1 percent in July, marking a clear sign of economic cooling. A year ago, in August 2024, inflation stood much higher at 9.6 percent.
Month-on-Month Drop in Prices
The month-on-month (MoM) inflation also reversed course. After a 2.9 percent increase in July, inflation in August declined by 0.6 percent. In contrast, the same month last year saw a 0.4 percent increase, indicating improved price stability this time around.
Urban Inflation Slows
Urban Consumer Price Index (CPI) inflation recorded a 3.4 percent year-on-year (YoY) increase in August—down from 4.4 percent in July and significantly lower than 11.7 percent in August 2024. On a monthly basis, urban inflation dropped by 0.7 percent, a stark contrast to the 3.4 percent rise seen in July.
Rural Areas Also See Relief
Rural CPI inflation stood at 2.4 percent YoY in August, compared to 3.5 percent in July and 6.7 percent in the same month last year. Month-on-month, rural inflation declined by 0.5 percent, following a 2.2 percent increase in July.
Sensitive Price Index (SPI) Trends Upward
The Sensitive Price Index (SPI), which measures the cost of essential items, rose 2.6 percent YoY in August. While this marks an increase from July’s 0.9 percent decline, it’s still well below the 10.8 percent spike seen in August 2024. However, on a month-to-month basis, SPI rose by 3.2 percent, slightly higher than July’s 3.1 percent increase.
Summary
The latest data suggests that inflationary pressures in Pakistan are beginning to ease, particularly when compared to the previous year. While challenges remain—especially in essential commodities—the overall trend points toward growing price stability across both urban and rural regions.
