IMF Sees Inflation Falling to 6.5% in Pakistan by 2027-28

The International Monetary Fund (IMF) has projected a decline in inflation to less than 6.5 percent by financial year 2027-28, high-level sources told ProPakistani.

The Fund also noted that Pakistan’s GDP will continuously grow in the next four years and is projected to reach 5 percent by FY27.

The Fund has estimated the inflation rate to be at 12.7 percent next financial year, 7.6 percent in the financial year 2025-26, and 6.5 percent in FY27 and FY28.

The IMF forecasts a continuous rise in foreign exchange reserves over the same period i.e. over 4 years. It is projected that Pakistan’s gross official reserves will reach $20.2 billion by 2028, sources added.

The current account balance is projected at negative 1.2 percent in FY25 and projected to reach negative 1.4 percent in FY28.

Meanwhile, the general government debt as a % of GDP is expected to fall to 69.9 percent next financial year, before gradually easing down to 68.8 percent in FY26, 67.2 percent in FY27, and 65.2 percent in FY28.

In its latest “Second and final review under the Stand-By Arrangement (SBA)”, IMF lowered the projection of Pakistan’s gross external financing needs to $21.044 billion for the next fiscal year 2024-25 i.e. 5.5 percent of GDP against $24.965 billion i.e. 7.1 percent of GDP for the outgoing fiscal year.

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