Inflation falls to 10.3%, but stays double-digit
Pakistan’s headline inflation eased to 10.3% year-on-year (YoY) in September 2026, down from 11.1% in August, according to data from the Pakistan Bureau of Statistics (PBS) released on Thursday.
Inflation was 5.8% in September 2025.
On a month-on-month basis, the consumer price index (CPI) rose 1.3% in September, compared with 1.2% in August and 2.1% in September 2025.
Urban and rural
Urban CPI inflation rose 10.1% YoY in September, down from 10.4% in August. It was 5.7% a year earlier. Month-on-month, urban prices rose 1.3%, compared with 0.9% in August and 1.6% in September 2025.
Rural CPI inflation rose 10.5% YoY, down from 12.2% in August and up from 5.9% a year earlier.
Month-on-month, rural prices rose 1.2%, compared with 1.6% in August and 2.8% in September 2025.
In the first quarter of FY27, CPI inflation averaged 10.2%, against 4.3% in the same period last year.
Government outlook
The Finance Division, in its monthly Economic Update & Outlook released a day earlier, said inflation would stay elevated in the near term. It projected headline CPI at 10-11% for September. The path beyond that, it said, depends largely on international oil prices.
The report said higher current spending and interest payments pushed the consolidated fiscal deficit to Rs596.6 billion in July 2026.
It named elevated global oil prices as the main risk to the outlook, citing their effect on purchasing power, input costs and the import bill.
The report said the Prime Minister’s Fuel Relief Scheme supports lower-income households through a digital delivery system, without cutting the petroleum levy. This, it said, protects purchasing power while preserving fiscal discipline.
Analysts’ expectations
Brokerage houses had expected inflation to ease to around 10% in September. They said rising fuel and electricity costs would keep price pressures elevated and complicate the central bank’s policy outlook.
Estimates from Topline Securities, Ismail Iqbal Securities, Abbasi and Company and Growth Securities ranged from 9.9% to 10.5% YoY.