ISLAMABAD: The International Monetary Fund (IMF) has issued a new report on Pakistan’s economic direction, warning that inflation is expected to rise again in the coming months. According to the organisation, the inflation rate during the current fiscal year may range between 4.5 and 6.3 per cent, while inflation will reach 8.9 percent by June 2026.
According to the report, the annual inflation rate in June 2025 was 3.2 percent, but global and domestic financial pressures may have a direct impact on prices in the coming years.
The IMF has also released the latest economic projections for the past two years and the current fiscal year. According to the document, Pakistan’s economic growth (GDP Growth) is likely to reach 3.2 percent in the current fiscal year. At the same time, the unemployment rate is expected to decline from 8 percent to 7.5 percent.
According to the organization, tax revenue will continue to grow, and the overall share of taxes may increase to 16.3 percent of GDP in fiscal year 2026, while this rate was recorded at 15.9 percent in 2025.
Regarding the fiscal deficit, the IMF said that this rate may decrease to 4 percent in 2026, which is currently 5.4 percent. The report also said that the country’s total debt volume may be equal to 69.6 percent of GDP in fiscal year 2026.
Regarding the external debt rate, the estimate of 22.5 percent has been maintained for 2026, which was the same in 2025.
The IMF, indicating a slight slowdown in the pace of investment in the future, said that investment in fiscal year 2026 may remain at 0.5 percent, while it was 0.6 percent in 2025.
On a positive note, the report suggests that Pakistan’s foreign exchange reserves could increase to $17.8 billion by 2026, a significant improvement from the current $14.5 billion.
