ISLAMABAD: The Government of Pakistan released its Economic Outlook Report for June 2025, highlighting a cautiously optimistic picture of the country’s macroeconomic landscape, with several indicators showing improvement while others remain under pressure.
According to the report, Real GDP growth reached 2.68%, supported by fiscal reforms, stronger external accounts, and rising investor confidence. Inflation dropped significantly to 3.5% in May 2025, down from 11.8% a year earlier.
The current account recorded a surplus of $1.81 billion, a remarkable turnaround from a $1.6 billion deficit the previous year. Remittances surged nearly 29% to $34.9 billion, while the rupee remained stable, trading around Rs 283.7 per USD as of June 27.
On the fiscal front, revenues increased robustly:
FBR tax collection rose by 25.9%, reaching Rs 10.23 trillion.
Non-tax revenue jumped 68% year-over-year.
As a result, the fiscal deficit narrowed to 3.2% of GDP, compared to 4.5% last year.
Meanwhile, the Pakistan Stock Exchange (PSX) performed impressively:
The PSX-100 index climbed 58.4%, closing at 124,379 points by the end of June.
Market capitalization rose to Rs 15.06 trillion ($53 billion).
However, not all sectors fared equally. Large Scale Manufacturing (LSM) posted a modest 2.3% growth in April, but cumulative output contracted 1.5% over July–April, reflecting persistent challenges in industrial activity. The report also flagged potential risks from geopolitical tensions, particularly in the Middle East, and high global trade barriers.
Below is a snapshot of the key economic indicators:
| Indicator | FY2024 | FY2025 | % Change |
|---|---|---|---|
| GDP Growth | 0.3% | 2.68% | ▲ +2.38 pts |
| Inflation (May) | 11.8% | 3.5% | ▼ -8.3 pts |
| FBR Tax Revenue (Jul-May) | Rs 8,126 bn | Rs 10,234 bn | ▲ +25.9% |
| Current Account Balance | -$1.6 bn | +$1.81 bn | Reversal |
| Remittances | $27.1 bn | $34.9 bn | ▲ +28.8% |
| PSX-100 Index | 78,528 pts | 124,379 pts | ▲ +58.4% |
| Market Capitalization | Rs 10.3 tn | Rs 15.06 tn | ▲ +45.8% |
| Policy Rate | 20.5% | 11% | ▼ -9.5 pts |
Outlook:
The Finance Division projects inflation to stay within 5–7% in FY2026, with exports expected to improve on the back of stronger global demand and rising remittances. However, the government acknowledged risks from volatile oil prices, regional conflicts, and uncertain global growth.
The report concludes that while Pakistan has made considerable progress in stabilizing its economy, sustained reforms and investments remain critical to maintain the momentum.
