Pakistan braces for 33% inflation in H1 2023: Moody's Analyst

February 15, 2023 (MLN): Inflation in Pakistan is likely to surge an average of 33% in Pakistan during the first half of 2023, a Moody's analyst predicted on Wednesday during an interview with Reuters.

Despite the country receiving a bailout from the International Monetary Fund, the analyst claims that this alone won't be sufficient to bring the economy back on track.

The root cause of the country's economic struggles lies in a lack of persistent and sound economic management. As food prices continue to remain high, poverty rates are likely to surge.

The situation is exacerbated by the weaker rupee, which is contributing to imported inflation.

Furthermore, high energy costs on the back of tariff increases, coupled with elevated food prices, are expected to keep inflation high.

Therefore, Moody's predicted further monetary tightening measures in Pakistan to stabilize the country's inflation.

The country's economic growth for the 2023 calendar year is to be around 2.1%, he added.

The situation in Pakistan calls for concerted efforts by the government and other relevant stakeholders to implement sound economic policies to avert a potential crisis.

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