The Government of Pakistan expects the country’s economic recovery to carry forward into the first quarter of FY2026, driven by strengthening macroeconomic fundamentals and growing investor optimism.
In its latest Monthly Economic Update & Outlook, the Finance Division noted that the large-scale manufacturing (LSM) sector is performing well and is likely to sustain its growth in June 2025. This is being fueled by increased credit flow to the private sector and a general pickup in industrial activity.
As production expands, imports of raw and intermediate goods are expected to rise, while exports—particularly of value-added goods—could see a further boost. This signals a healthier external trade outlook, particularly for July 2025.
The report also highlighted a stable rupee, moderate global commodity prices, and rising foreign demand as favorable factors. Together, these are expected to positively impact exports, worker remittances, and import levels, ensuring external sector balance.
The Finance Division emphasized that this recovery marks a critical phase in Pakistan’s broader economic stabilization and policy reform process.