Inflation in Pakistan won't decline till the end of current fiscal year: IMF
MF's Regional Economic Outlook Report says inflation in Pakistan will remain above 11%
ISLAMABAD (Dunya News) – In yet another bad news for already suffering people, the International Monetary Fund (IMF) said that the inflation wouldn’t come down till the end of the current fiscal year.
According to the IMF s Regional Economic Outlook Report, inflation in Pakistan will remain above 11% by the end of this financial year, while the country’s economic growth is expected to be at 4% this year as compared to its growth of 5.6% during the previous year.
The report further said that this year, the inflation rate will be 11.1 percent, inflation will be 3.4 percent higher than the October 2021 estimate, global food and energy prices have been cited as the main reason for inflation.
Pakistan s current account deficit ballooned to US$13.2 billion in the nine months of its fiscal year from a gap of US$275 million a year earlier on the back of soaring oil import costs, official data showed.
Rating agency Moody s expects the deficit to widen to 5-6per cent of gross domestic product in the current fiscal year ending June 30, up from its earlier 4per cent projection, putting greater pressure on Pakistan s foreign reserves.
Jihad Azour, director of IMF s Middle East and Central Asia Department, told Reuters the fund s team will assess the policy priorities of the new government and the economic impact in the context of the war in Ukraine.
"But of course, we have been over the last few months highlighting the importance of maintaining the current account situation under control… reduce the current account deficit."
He did not elaborate on the policy actions, but the IMF has said earlier a continued commitment to a market-determined exchange rate and a prudent macroeconomic policy mix will help reduce the deficit.