ISLAMABAD (Dunya News) – The Ministry of Finance has issued its Monthly Economic Update and Outlook Report, revealing mixed signs for Pakistan’s economy as investment, exports, and private sector lending continue to shrink, while remittances and industrial growth provide a ray of hope.
According to the report, inflation may climb to 6.5% in December, compared to 6.1% recorded in November 2025. A year earlier, in November 2024, inflation stood at 4.9%, showing that the cost of living is gradually creeping up. Officials say that rising food and fuel prices remain “the elephant in the room,” adding pressure on low- and middle-income households.
The report highlights that from July to November, investment dropped by 25.3%, falling sharply to $930 million, signaling that foreign and domestic investors are keeping their cards close to their chest due to uncertainty. Exports during the first five months of the fiscal year fell 3.2%, standing at $12.8 billion, suggesting that Pakistan needs to “turn the tide” to stay competitive in global markets.
On the flip side, workers’ remittances jumped by 9.3%, reaching $16.14 billion, becoming a lifeline for the economy. Imports rose 11.1% to $25.6 billion, reflecting higher demand for industrial and consumer goods, although analysts warn that rising imports could “open a can of worms” for the external account if not controlled.
The Finance Ministry stated that Pakistan’s industrial sector is showing “glimmers of light at the end of the tunnel,” with positive trends recorded in textiles, automobiles, cement, andfood processing.
Improved production in these industries is expected to play a key role in stabilising the economy in the coming months.
Regarding the current account, the report notes that the deficit remains within the government’s annual target. For July-November, the deficit declined to $812 million, showing that policy measures and spending control are beginning to “pay off.”
The report also attributes economic stability to better financial discipline, controlled public expenditure, improved tax collection, good governance, and ongoing digital reforms. It further states that overseas Pakistanis will continue to act as a backbone for the country’s economy through increasing remittances.