Pakistan’s inflation stabilises, highlighting core cost challenges

Inflation in Pakistan has shown notable moderation in the early months of FY26, offering policymakers a degree of relief after several years of severe price instability. According to official data, headline inflation has remained within the State Bank of Pakistan's (SBP) medium-term target range of 5-7% during July-November FY26. This marks a significant departure from the double-digit inflation that dominated much of FY23 and FY24 and signals that macroeconomic stabilisation measures are beginning to take hold. However, beneath this encouraging headline figure, core inflation remains stubbornly elevated, highlighting deeper structural pressures that could complicate the disinflation path going forward.