The International Monetary Fund (IMF) has revised Pakistan’s GDP growth forecast for the fiscal year 2025, lowering it to 2.6 percent from the earlier estimate of 3 percent made in January. This update was released in the IMF’s latest World Economic Outlook report, titled “A Critical Juncture Amid Policy Shifts.” For 2026, the forecast is slightly more hopeful, with growth projected at 3.6 percent.
Inflation in Pakistan is expected to see a significant drop, falling from a high of 23.4 percent in FY2024 to just 5.1 percent in FY2025. It is anticipated to rise slightly to 7.7 percent in FY2026.
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Unemployment is predicted to decline gradually, with the rate expected to fall from 8.3 percent in 2024 to 8 percent in 2025, and further to 7.5 percent in 2026. The country’s current account deficit is also projected to shrink, improving from -0.5 percent of GDP in 2024 to -0.1 percent in 2025, before widening slightly to -0.4 percent in 2026.
Meanwhile, government net borrowing is forecast to decrease, dropping to -5.6 percent of GDP in 2025 from -6.8 percent in 2024, signaling efforts toward fiscal consolidation.
