Karachi November 28 2024: Pakistan headline inflation is expected to drop below 5% mark for the month of November on easing electricity charges, says Arif Habib report.
However, Ministry of Finance expects inflation to remain within the range of 5.8 percent – 6.8 percent in November, further receding to 5.6 percent – 6.5 percent by December 2024.
During Jul-Oct FY2025, CPI Inflation stood at 8.7 percent against 28.5 percent recorded the same period last year.
“We project that inflation in Nov’24 will come down to 4.7 percent YoY (0.3 percent MoM) from last month’s 7.2 percent. This will bring the average inflation rate for 5MFY25 to 7.9 percent, a significant decrease from 28.6 percent during the same period last year” writes Sana Tawfik an economist at Arif Habib Limited in its note.
This marks the lowest inflation reading since Apr’18 (3.96 percent).
She expects prices for chicken, bananas, and onions to decline by 14.3 percent, 4.9 percent, and 3.6 percent MoM, respectively.
The electricity index, however, is expected to decline by 1.1 percent MoM, driven by a negative FCA of PKR 1.28/KWh for Sep’24, which will fall in Nov’24 bills. In comparison, the FCA for the previous month was PKR -0.86/KWh, Tawfik Added.
