Pakistan’s Consumer Price Index (CPI) based inflation is expected to fall sharply from January 2024 onwards while the central bank is slated to cut its key interest rate by 7 percent by end-2024, said Topline Securities in a brief note on Friday.
“We believe Pakistan CPI inflation to fall sharply from Jan 2024. Over the next 12 months (Nov 2023-Oct 2024) our average CPI estimate is 18.5%. We expect CPI to average 23% in FY24 and 15% in FY25 compared to 29% in FY23, it said in a tweet on X (formerly Twitter).
“Recent IMF press release also endorsed that “Inflation is expected to decline over the coming months amid receding supply constraints and modest demand”. With clear signs of decline in inflation, we expect SBP policy rate to fall by 7% in 2024 to reach 15% by Dec 2024 compared to 22% now,” it added.
We believe Pakistan CPI inflation to fall sharply from Jan 2024. Over next 12 months (Nov 2023-Oct 2024) our average CPI estimate is 18.5%. We expect CPI to average at 23% in FY24 and 15% in FY25 compared to 29% in FY23. Recent IMF press release also endorsed that “Inflation is… pic.twitter.com/OyI94W553F
— Topline Securities (@toplinesec) November 24, 2023
It should be noted that CPI inflation increased to 26.9 percent on a year-on-year basis in October 2023. Inflation eased in October as authorities slashed fuel prices and cracked down on illegal forex trade during the period.
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