Business
ADB forecasts high inflation during FY2024-25
Asian Development Bank predicts seven per cent reduction in Pakistan’s debt volume
Islamabad: The Asian Development Bank (ADB) on Wednesday published its Asian Development Outlook report, predicting a 7% reduction in Pakistan’s debt volume.
The debt is projected to decrease from 77% to 70% of the nation’s GDP.
The report indicated that 62% of Pakistan’s revenue will be dedicated to debt repayment in the current fiscal year. It also forecasts that inflation will remain high during this period.
In the last fiscal year, Pakistan achieved a growth rate of 2.4%, with the agriculture sector playing a crucial role in this economic expansion. The report further highlighted a reduction in inflation from 38% to 11.8%, which has led to a decrease in policy rates.
The ADB stresses the importance of addressing debt and inflation to secure sustainable economic growth in Pakistan. The report offered valuable insights and recommendations for improving the country’s economic outlook.
Inflation Rises Following Budget 2024-25
In related developments, the start of the new fiscal year 2024-25 has witnessed a surge in inflation, with a 1.28% increase in the weekly inflation rate, as reported by the Pakistan Bureau of Statistics (PBS). The annual inflation rate has now reached 23.59%.
According to the PBS weekly report, prices of 29 essential items have increased over the past week, while prices of five items have remained stable, and 17 items have seen a decrease. Notably, the price of tomatoes has surged by 70.77%, with the average price per kilogram surpassing Rs 200.
Key Points:
Debt Reduction: ADB forecasts a 7% decrease in Pakistan's debt volume.
Revenue Allocation: 62% of revenue will go towards debt repayment.
Inflation Trends: High inflation is expected to persist.
Economic Growth: The previous fiscal year recorded a 2.4% growth rate, driven by agriculture.
Price Increases: Significant rises in essential item prices, particularly tomatoes.
Stay informed with the latest updates on Pakistan’s economic conditions and financial trends.