Pakistan’s weekly inflation drops 0.83% as food prices decline

Pakistan’s short-term inflation fell by 0.83% for the week ending April 10, driven by significant drops in the prices of essential food items, official data showed on Friday.

Prices of garlic plummeted by 14.73%, tomatoes by 12.82%, onions by 11.40%, and chicken by 8.05%. Other notable declines included eggs (7.40%), bananas (6.72%), wheat flour (4.74%) and potatoes (2.33%).

However, some items saw price increases, including pulse gram (1.63%), liquefied petroleum gas (0.64%), beef and curd (0.59% each), and cigarettes (0.06%).

Year-over-year, inflation decreased by 2.81% compared to the same week in 2023.

Pakistan’s inflation rate in March slowed to 0.7%, its lowest level in nearly two years, after peaking at around 40% in May 2023. Analysts expect a slight uptick in April, projecting inflation between 2% and 3%.

The economy has stabilized under a $7 billion International Monetary Fund bailout, which helped avert a default last year. The government is now awaiting IMF approval of its first review under the program, which would release an additional $1 billion before Pakistan’s annual budget, typically presented in June.

Improved exports and remittances are also easing external financing pressures. Analysts anticipate further remittance growth due to Ramadan and the upcoming Eid al-Fitr holiday, when overseas Pakistani workers traditionally send more money home.

The IMF program, along with bilateral loan rollovers from allied nations, continues to support Pakistan’s financial stability, officials said.