Policy uncertainty eases slightly in May

June 05, 2026 (MLN): Pakistan's Economic Policy Uncertainty Index (EPUI) declined in May 2026 from the record-high levels seen in the previous two months, though uncertainty remained significantly above historical norms.

According to data compiled by the State Bank of Pakistan (SBP) from economic and policy-related coverage in Business Recorder, Express Tribune, Dawn, and The News, the four-newspaper composite index (EPUI-4) stood at 282.7 in May 2026, down from 343.0 in April.

Similarly, the two-newspaper measure (EPUI-2) fell to 342.4 in May from a record 410.4 in the previous month.

Despite the month-on-month decline, the index remained at historically high levels. The EPUI-4 has stayed above 200 for five consecutive months from January to May 2026, marking the longest such streak on record.

On a yearly basis, the EPUI-4 increased by 66% from 170.3 in May 2025, while the EPUI-2 rose 58.3% from 216.3 recorded a year earlier.

The data indicates that although uncertainty moderated during May, Pakistan's economic and policy environment continues to face elevated levels of unpredictability compared to previous years.

Analysts noted that sustained policy uncertainty can affect business confidence, investment decisions, and overall economic activity, highlighting the importance of policy consistency and clarity for long-term economic stability.

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