The Ministry of Finance has reported a potential 11% decline in wheat production for 2025, attributing the drop to dry weather conditions. Wheat output is expected to fall to 27.9 million metric tons this year, down from last year’s bumper harvest of 31.4 million metric tons. The Pakistan Meteorological Department (PMD) warned that ongoing dry conditions may cause water stress for Rabi crops, particularly wheat in rain-fed areas.
Despite this, inflation is projected to remain stable at around 3% in February, according to the finance ministry’s monthly economic outlook. The report also highlighted the possibility of inflation rising slightly to 4% by March. In January, inflation stood at 2.4%, supported by a reduction in the central bank’s policy rate, which now stands at 12%.
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The ministry also noted that the upward trend in exports, imports, and remittances would continue in February. Pakistan recorded $20.8 billion in remittances during the first seven months of FY25, a 31.7% increase over the previous year. With Ramazan and two Eid festivals approaching, remittances are expected to rise further, boosting the external sector’s stability.
On the trade front, imports of goods reached $33.3 billion, showing a 10.9% increase over last year. However, the trade deficit widened to $14.1 billion from $12.2 billion last year. The current account recorded a deficit of $420 million in January 2025, slightly higher than the $404 million deficit in January 2024.
