Karachi: Pakistan's inflation rate for April 2026 is forecasted to reach between 11.0% and 11.5% year-on-year, marking the highest monthly inflation rate in 21 months. This increase is primarily driven by a significant rise in fuel prices, despite a decrease in wheat prices, according to recent projections.
According to JS Global, the Consumer Price Index (CPI) for April 2026 is anticipated to rise significantly compared to 7.30% in March 2026 and 0.28% in April 2025. On a month-on-month basis, inflation is projected to increase by 2.65%, largely due to a 22.5% rise in the transport segment. This surge follows an escalation in international oil prices, as tensions between Iran, the United States, and Israel have disrupted global energy markets, pushing crude oil prices above $100 per barrel. Within the transport category, prices of Petrol Super (MS) and High-Speed Diesel (HSD) have risen by 17.9% and 54.7%, respectively.
The Housing, Water, Electricity, and Gas category is expected to see a 2.2% month-on-month increase in April 2026. This is primarily driven by a nearly 36% rise in Liquefied Petroleum Gas (LPG) prices. Electricity charges are also likely to experience a slight increase due to a Quarterly Tariff Adjustment and a Fuel Charges Adjustment, along with a scheduled quarterly rent adjustment estimated at 1.4%.
Food inflation is projected to rise by 1.17% month-on-month, influenced by significant price increases in tomatoes, onions, chicken, and potatoes. However, this growth is expected to be mitigated by a 10-17% decline in wheat and fresh fruit prices.
With an anticipated inflation rate of 11-11.5% for April 2026, the real rates are expected to return to negative territory after 25 months. Historically, Pakistan has maintained average positive real rates in the range of 200-300 basis points.