ISLAMABAD: Pakistan’s annual inflation eased to 9.6% in October 2026 from 10.3% in September, although rising consumer prices continued to put pressure on households, with average inflation during the first four months of FY27 reaching 10.05%.
According to data released by the Pakistan Bureau of Statistics (PBS) on Monday, the Consumer Price Index (CPI) recorded an increase of 9.6% year-on-year in October, compared with 6.2% in the corresponding month last year.
On a month-on-month basis, inflation increased by 1.1% in October, compared with 1.3% in September and 1.7% in October 2025, indicating a slower pace of monthly price increases.
The urban inflation rate declined to 9.5% year-on-year in October from 10.1% in September, compared with 6.0% in October last year. On a monthly basis, urban inflation increased by 0.8%, against 1.3% in September and 1.4% in October 2025.
In rural areas, inflation eased to 9.8% year-on-year in October from 10.5% in September, while it stood at 6.6% in the corresponding month last year. However, rural inflation increased by 1.5% month-on-month, compared with 1.2% in September and 2.1% in October 2025.
Despite the moderation in the headline inflation rate, the cumulative inflationary pressure remained significantly higher during the current fiscal year. Average CPI inflation during July-October FY27 stood at 10.05%, compared with 4.79% in the corresponding period of the previous fiscal year.
The October inflation reading was broadly within the Finance Ministry’s projections. In its Monthly Economic Update and Outlook for October 2026, the ministry had projected headline inflation in the range of 9.5% to 10.5%, citing elevated international energy and domestic food prices.
The ministry had also cautioned that the subsequent inflation trajectory would remain sensitive to international energy prices, food supplies and base effects.
Meanwhile, brokerage houses had anticipated some moderation in inflation during October, although their estimates were slightly below the actual reading.
Topline Securities had projected October inflation at 9% to 9.5% year-on-year, compared with 10.26% in September and 6.25% in October 2025.
The brokerage house also warned that average inflation could exceed 9% in FY27 if international oil prices remained between $100 and $110 per barrel, revising its earlier average inflation forecast of 8.5% to 9%.
Similarly, Insight Securities had projected October inflation at 9.3%, compared with 10.3% in September and 6.2% in the corresponding month last year.
The latest inflation figures will remain important for the monetary policy outlook, as persistent energy and food price pressures could complicate the State Bank of Pakistan’s assessment of inflationary risks during the current fiscal year.