Pakistan’s headline inflation rose to 5.8% on a year-on-year basis in January 2026, official data showed on Monday, broadly in line with the Ministry of Finance’s projection of 5% to 6%, it was reported on Monday.
Data released by the Pakistan Bureau of Statistics (PBS) showed consumer price inflation eased slightly from 5.6% in December 2025 but remained well above the 2.4% recorded in January last year.
On a month-on-month basis, inflation increased by 0.4% in January, reversing a 0.4% decline in December and matching the pace seen in January 2025.
Average inflation for the first seven months of the fiscal year, from July 2025 to January 2026, stood at 5.24%, compared with 6.50% during the same period last year, PBS data showed.
Urban consumer inflation remained steady at 5.8% on an annual basis in January, compared with the previous month, while it rose 0.2% month-on-month. In January 2025, urban inflation stood at 2.7%.
In rural areas, annual inflation increased to 5.8% in January from 5.4% in December, while month-on-month prices rose by 0.6%, reversing a 0.6% decline recorded a month earlier. Rural inflation was 1.9% in January last year.
The Finance Division, in its Monthly Economic Update and Outlook for January 2026, had forecast inflation to remain within the 5%–6% range.
Last week, the State Bank of Pakistan (SBP) kept its benchmark policy rate unchanged at 10.5% at its first Monetary Policy Committee meeting of the year, defying market expectations of a rate cut.
SBP Governor Jameel Ahmad said inflation could rise above 7% in the second half of the current fiscal year, while projecting economic growth of between 3.75% and 4.75% for the year.
