Business confidence falls to 48 in October

October 26, 2026 (MLN): Overall business confidence weakened further in October 2026, with the Business Confidence Index (BCI) falling 1.1 points to 48, led by a decline in services sector sentiment, the State Bank of Pakistan’s (SBP) latest survey showed.

The Purchasing Managers Index (PMI) also eased 1.4 points to 51.8, though it stayed above the neutral threshold, while businesses’ inflation expectations moderated and manufacturing capacity utilization improved.

The Business Confidence Survey (BCS) is conducted by the SBP in collaboration with the Institute of Business Administration (IBA).

The latest round ran from October 1 to 14, 2026, and covered 491 respondents.

The Services sector BCI slipped 1.6 points to 47.7, while the Industry sector BCI edged up 0.2 points to 48.7.

The Current Business Confidence Index (CBCI), which reflects views on general economic conditions over the past six months, eased 1.1 points to 45.4.

The Expected Business Confidence Index (EBCI), which captures the outlook for the next six months, fell 1.2 points to 50.5.

The PMI declined across all components except order books. Order books rose to 51.9, while business activity fell to 50.3, total employees to 48.7, raw material purchases to 55 and speed of suppliers’ delivery to 53.2.

Aggregate inflation expectations eased to 7.1 from 7.7 in the previous wave. The share of businesses expecting higher prices edged up to 70.0 % from 69.8 %. In the Industry sector it rose to 71.4 % from 69.5 %, while in the Services sector it fell to 68.9 % from 70.1 %.

Employment sentiment weakened. The Current Employment Index fell to 45.4 from 48.9 in September, while the Expected Employment Index eased to 50.4 from 53.1. In manufacturing, average current capacity utilization rose to 67.9 % from 64.8 % in the previous wave.

Copyright Mettis Link News