Pakistan’s inflation rate eased in October, but the relief is only partial. Consumer prices rose 9.6 percent in October 2026 compared with the same month last year, down from 10.3 percent in September, according to data from the Pakistan Bureau of Statistics released on Monday.
Inflation is the rate at which prices rise over time. The Consumer Price Index, or CPI, tracks the cost of a basket of everyday goods and services, from food and fuel to rent and clothing. When inflation is reported “year-on-year”, it means prices are compared with the same month a year earlier. October’s 9.6 percent therefore means the basket cost 9.6 percent more than it did in October 2025, when inflation was 6.2 percent. The October reading was inside the Finance Ministry’s forecast range of 9.5 to 10.5 percent.
What slowed, and what did not
The main reason for the easing was food, especially perishable food items such as fresh vegetables, whose prices cooled after a sharp rise the month before. Overall food inflation eased to 7.74 percent from 8.2 percent in September. Core inflation, which leaves out volatile food and energy prices to show the underlying trend, also eased, to 7.8 percent from 8.6 percent in September.
Not everything cooled. Transport costs were still 28.61 percent higher than a year earlier, reflecting the high fuel prices of recent months, and prices for non-perishable food items rose faster than before. That split matters for households: the items people buy every week may feel a little less pressured, while travel and transport costs remain a heavy burden.
A slower rate is not falling prices
Here is the point most easily misunderstood. A lower inflation rate does not mean prices fell. It means prices rose more slowly than they did the month before. In fact, prices still rose 1.1 percent during October alone, compared with a 1.3 percent monthly rise in September. Month-on-month inflation compares one month with the month before it, and a 1.1 percent monthly rise, repeated over a year, would still add up to a large increase.
The longer picture is also less comfortable. Average inflation for the first four months of the financial year, July to October, stood at 10.05 percent, compared with 4.79 percent in the same period last year. Inflation also remains well above the State Bank of Pakistan’s target range of 5 to 7 percent, which is one reason the central bank raised its policy interest rate to 12 percent in late October. The policy rate is the rate at which the central bank lends to banks, and it influences borrowing costs across the economy.
What this means
For an ordinary household, October’s data offers modest comfort, not a reason to relax. The pace of price rises is easing for a third month in a row, and food pressures have softened, but transport costs are still rising fast, and prices went up again during the month itself. The next test is whether November continues the easing, especially if oil prices stay lower, or whether fuel and food costs push the rate back up. Until the monthly rise itself slows much further, family budgets will keep feeling the squeeze, even as the headline number improves. This article is information only, not a recommendation to buy or sell any share.
Sources: Dawn, Business Recorder, Pakistan Bureau of Statistics. Written in our own words for information only — not investment advice.