Pakistan's inflation expected to stay high in 2026: Finance ministry says

Islamabad: Pakistan's inflation is expected to remain elevated in the short term, according to the Ministry of Finance's latest Monthly Economic Update.

The report stated that average inflation stood at 7.1% during the last fiscal year, compared with 4.5% in fiscal year 2024–25. Inflation accelerated further in June, reaching 11.1%.

For July, the ministry projected inflation to range between 9% and 10%, while noting that the country's external sector is expected to remain stable.

However, the report warned that renewed geopolitical tensions in the Middle East could pose downside risks to both the inflation outlook and the stability of the external sector.

The ministry said the recovery in economic activity is continuing and that overall macroeconomic stability is expected to be maintained.

According to the report, workers' remittances reached $41.6 billion during the previous fiscal year, while revenue collection also recorded significant growth.

Exports for the period stood at $30.8 billion, reflecting continued improvement in external trade performance.