Inflation, unemployment fears drag consumer confidence to two-year low

September 06, 2026 (MLN): Pakistan's Consumer Confidence Index (CCI) fell sharply to 65.3 in the third quarter of FY2026, down from 86.4 in the previous quarter, marking a 24.4% decline and pushing consumer sentiment to its lowest level in two years despite official claims of macroeconomic stability.

The 20th edition of the CCI, jointly released by Dun & Bradstreet Pakistan and Gallup Pakistan, showed a broad-based deterioration in sentiment, with both current conditions and future expectations weakening from the previous quarter.

The current sentiment sub-index dropped to 51.8, while the future outlook, though comparatively better, stood at 78.7.

The index tracks consumer perceptions of the economy and personal finances across four parameters: household financial situation, national economic conditions, unemployment, and savings.

The Q3 survey, conducted among 1,592 respondents, found inflation to be the dominant concern, with 89.3% of respondents reporting price hikes for essential goods over the last six months.

Unemployment emerged as another major source of strain, with 81% saying joblessness had worsened over the same period. Household sentiment offered little relief either, as nearly 40% of respondents expect their finances to worsen further in the next six months.

Bilal Gilani, Executive Director at Gallup Pakistan, noted that the Q3 2026 reading of 65.3 places Pakistan firmly in extremely pessimistic territory, calling it the sharpest single-cycle drop recorded in recent years.

He added that the decline was not a crisis of expectations alone, pointing out that with the current sentiment index down to 51.8, consumers are struggling today, not just worried about tomorrow.

The decline in confidence was not evenly distributed across age groups.

Respondents aged 50 and above recorded the steepest drop, at 30.4%, while those below 30 saw a comparatively smaller decline, though they too remained far less optimistic than in the previous survey.

Zubair Qureshi, Chief Business Officer at Dun & Bradstreet Pakistan, said the numbers reflect real pressure on consumers at present, stressing that confidence would not recover on its own and that visible improvement would be needed on both the inflation and employment fronts before sentiment could shift.

He described the findings as exactly the kind of signal businesses and policymakers need as they assess risk and plan ahead.

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