Pakistan’s inflation is expected to increase again starting April as rising global oil prices begin pushing up domestic fuel, electricity, and transport costs, potentially reversing the country’s recent disinflation trend.
According to a report cited by The Express Tribune, market analysts and brokerage firms — including JS Global Capital Limited — believe the ongoing global energy shock will significantly impact consumer prices in the coming months.
Inflation Forecast Near 10 Percent
Research estimates from financial institutions, including Arif Habib Limited, suggest inflation could approach 10 percent in April, while March inflation is projected to remain in the high 7 percent range.
Analysts say the primary driver behind the expected increase is the sharp rise in international oil prices. Despite partial government subsidies, domestic fuel prices reportedly increased by nearly 25 percent on average in March, leading to higher transportation costs across the economy.
Experts estimate that fuel and transport expenses alone contributed nearly two-thirds of the monthly inflation increase, highlighting the strong link between energy prices and overall consumer inflation.
Electricity Costs Add Further Pressure
Electricity tariffs have also intensified financial pressure on households and businesses. A fuel cost adjustment of Rs1.63 per unit, now extended to previously protected consumers, has pushed the electricity index higher.
Rising logistics expenses and increased industrial input costs have widened inflationary pressures beyond food items, creating broader cost-push inflation throughout multiple sectors of the economy.
SBP Policy Decision in Focus
Investors and businesses are now closely watching the upcoming Monetary Policy Committee meeting of the State Bank of Pakistan scheduled for April 27. The central bank previously kept the policy rate unchanged at 10.5 percent, but rising oil prices and geopolitical uncertainty may influence future decisions.
Broader Economic Risks Highlighted
Analysts at JS Global Capital Limited have also warned of wider macroeconomic risks if oil prices remain elevated. Sustained increases could expand Pakistan’s import bill, put pressure on the current account balance, and create renewed stress on foreign exchange reserves.
Economists believe inflation trends in the coming months will largely depend on global energy markets, exchange rate stability, and government measures aimed at cushioning consumers from rising costs.
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