Pakistan’s headline inflation eased to 3% year-on-year (YoY) in August 2025, down from 4.1% recorded in July 2025, according to data released by the Pakistan Bureau of Statistics (PBS) on Monday.

On a month-on-month (MoM) basis, inflation decreased by 0.65% in August compared to July. The urban CPI registered a sharper decline of 0.73%, while the rural CPI dropped by 0.52%.

This reduction was primarily driven by a significant fall in the prices of perishable food items, including fresh fruits and vegetables, as well as a decrease in electricity charges.

Food Prices: The food and non-alcoholic beverages category, which holds the largest weight in the CPI basket, saw a mixed trend. While perishable food items recorded a sharp decline of 12.07% on a monthly basis, non-perishable food items rose by 0.57%. Items such as fresh fruits, vegetables, and potatoes saw significant price drops, while staples like rice, meat, and milk experienced slight increases.

Energy Costs: Electricity charges and motor fuel prices also contributed to the overall decline in inflation, with electricity costs dropping by 6.87% and motor fuel by 1.51% on a monthly basis.