IMF projects higher inflation than government’s target

ISLAMABAD (Rizwan Abbasi): The International Monetary Fund (IMF) has projected that Pakistan’s average inflation rate during fiscal year 2026-27 is likely to exceed the target set by the federal government.

According to the IMF, average inflation is expected to stand at 8.4 percent in the current fiscal year, compared to the federal government’s budget target of 8.2 percent.

The IMF’s projection is therefore slightly higher than the official target. In its latest report, the IMF forecasts that inflation will gradually decline after the current fiscal year.

It projects average inflation to fall to 6.6 percent in fiscal year 2027-28 and 6.5 percent in fiscal year 2028-29. The report further expects inflation to remain at around 6.5 percent during fiscal years 2029-30 and 2030-31.

The IMF also projects that Pakistan’s average inflation will remain in single digits for the next five fiscal years. The report notes that average inflation has already remained in single digits during the past two fiscal years.

According to the available data, Pakistan’s average inflation stood at 7.05 percent in fiscal year 2025-26, 4.49 percent in fiscal year 2024-25, 23.4 percent in fiscal year 2023-24, and 29.2 percent in fiscal year 2022-23.