IMF raises Pakistan FY27 inflation forecast to 9.9%, growth seen at 3.5%

October 13, 2026 (MLN): Pakistan’s consumer prices are projected to rise by nearly 10% in FY2026-27, according to the IMF’s World Economic Outlook released on October 13, 2026.

Average inflation is forecast at 9.9%, against an estimated 7.1% in FY26 and 4.5% in FY25. Real GDP growth is projected at 3.5%, from 3.6% in FY26.

National CPI inflation stood at 10.3% year-on-year in September 2026, easing from 11.1% in August but well above the 5.8% recorded a year earlier. Average inflation for 3MFY27 came in at 10.2%, against 4.3% in the same period last year.

Wholesale prices continued to firm, with the Wholesale Price Index rising 13.3% YoY in September from 11.8% in August, while the Sensitive Price Index increased 8.4% YoY, down from 9.5% in the previous month.

In its staff-level agreement on the Extended Fund Facility (EFF), the IMF noted that headline inflation peaked in May before cooling to around 10.3% in September, while core inflation stayed contained.

The IMF also flagged geopolitical tensions, volatile energy prices, tighter global financial conditions and trade disruptions as key risks to the outlook.

The report also expects the external position to weaken. The current account, estimated at a surplus of 0.5% of GDP in FY25, is projected to move to balance in FY26 and a deficit of 1.0% of GDP in FY27. Unemployment is forecast to ease from 7.1% to 6.5% by FY27.

Pakistan is grouped among oil-importing economies of the Middle East and Central Asia, for which inflation is projected at 9.4% in 2026 and 11.0% in 2027.

The region’s output is expected to shrink 0.3% in 2026 before rebounding 6.3% in 2027, assuming the Strait of Hormuz reopens in March 2027.

In South Asia, India is projected to grow 7.0% in both years, while Bangladesh is seen at 3.6% and 3.2% with inflation of 8.7% and 10.9%.

Globally, growth is projected at 3.1% in 2026 and 3.4% in 2027, while headline inflation is seen at 4.7% this year before easing to 4.1%. Oil is assumed to average $95.74 a barrel in 2026 and $87.39 in 2027, against $67.74 in 2025.

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