📊 Quick answer: PBS calculates CPI by pricing a fixed basket of ~356 goods and services across 35 cities every month, weighting each item by its share of average household spending, and indexing the result to a base year (currently 2015-16 = 100). The inflation rate is the year-on-year % change in that index. Across the first 11 months of FY2025-26 (Jul 2025-May 2026), YoY inflation averaged ~6.7%, per PBS data — see the live CPI tracker for the latest figure.
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What CPI Actually Measures
The Consumer Price Index (CPI) is a single number that tracks how much more (or less) it costs, on average, for a typical Pakistani household to buy the same basket of goods and services over time. It isn't a survey of opinions or a guess — it's built from tens of thousands of actual price observations that PBS field staff collect in markets across the country every single month.
When you hear "inflation is 6.98%," that number is derived directly from the CPI: it's the percentage change in this index compared to the same month a year earlier. Everything else — the basket composition, the city sample, the weighting scheme — exists to make that one percentage as representative as possible of what households actually experience.
The CPI Formula
At its core, CPI is a weighted price ratio, indexed to 100 in a chosen base period:
The inflation rate most people care about — the one quoted in the news — is not the index itself but its year-on-year (YoY) change:
A second, less-quoted but useful figure is month-on-month (MoM) inflation, which strips out the base-year comparison entirely and just measures short-term momentum:
YoY is the headline figure because it smooths out seasonal fluctuations (like Ramazan food prices or winter energy demand). MoM is what economists and the State Bank watch to catch turning points before they show up in the YoY number.
The Basket & Its Weights
Not every price move affects the index equally. PBS weights each category by its approximate share of an average household's budget — so a rise in the price of rice moves the index far more than the same percentage rise in, say, recreation. The approximate national weights under the current 2015-16 base are:
| Category | Approx. weight in CPI |
|---|---|
| Food & non-alcoholic beverages | 34.6% |
| Housing, water, electricity, gas & fuels | 23.6% |
| Miscellaneous goods & services | 7.6% |
| Transport | 7.2% |
| Clothing & footwear | 6.5% |
| Restaurants & hotels | 5.0% |
| Furnishing & household equipment | 4.1% |
| Education | 3.9% |
| Health | 2.4% |
| Communication | 2.2% |
| Recreation & culture | 1.3% |
| Alcoholic beverages & tobacco | 1.5% |
This is why food and housing dominate every Pakistani inflation headline — together they make up nearly 60% of the index, so swings in wheat, electricity, or gas tariffs move the national number far more than anything else in the basket. Weights are based on household spending surveys and only change when PBS rebases the index (see below) — for the exact, currently notified weights, PBS's published CPI methodology is the authoritative source.
💡 Why this matters for you: The headline inflation rate can feel "wrong" if your own spending pattern doesn't match the national basket. A renter with no car experiences a very different personal inflation rate than a homeowner who drives daily — even though both are quoted the same 6.98% or 11.66%.
Worked Example, Using Real 2025-26 Data
Here's exactly how PBS's published numbers turn into the inflation rate you read about — using the actual index values for May 2025 and May 2026:
| Period | CPI Index (2015-16=100) |
|---|---|
| May 2025 | 263.60 |
| April 2026 | 292.81 |
| May 2026 | 294.34 |
Year-on-year inflation for May 2026:
Month-on-month inflation for May 2026:
These are the exact figures PBS reported, and they match the numbers on our live CPI inflation tracker, which pulls this same index directly from PBS's data feed and updates automatically each month.
Base Year & Rebasing
The index needs a fixed reference point to be meaningful — that's the "base year," set to exactly 100. Pakistan's CPI currently uses 2015-16 as its base; before that, the base year was 2007-08. An index reading of 294 today means prices are, on average, about 194% higher than they were in 2015-16 — not that prices rose 194% this year.
PBS periodically rebases the index — updating both the reference period and the basket's composition and weights — to keep it representative as household spending habits shift (for example, as mobile data becomes a bigger share of spending than it was a decade ago). Rebasing doesn't change how much inflation actually happened; it resets the yardstick so future comparisons stay accurate.
CPI vs SPI vs WPI: Three Different Indices
Pakistani news often mentions three different price indices, and they measure different things:
- CPI (Consumer Price Index): Retail prices paid by consumers, released monthly by PBS. This is the headline inflation rate discussed throughout this article.
- SPI (Sensitive Price Indicator): A smaller basket of daily-use essentials, released weekly and weighted toward lower-income households — it reacts to price shocks faster than CPI because it's measured more often.
- WPI (Wholesale Price Index): Prices at the wholesale/producer level rather than retail. Because wholesale price changes usually feed through to retail shelves with a lag, WPI can act as an early signal of where CPI is headed next.
If you want the single most representative "cost of living" number, CPI is it. SPI and WPI are useful supplements for spotting turning points before they show up in the monthly CPI release.
FY2025-26 Inflation, Month by Month
Fiscal year 2025-26 (July 2025 – June 2026) traced a clear arc: inflation bottomed out around mid-year and then climbed sharply as the high base from the previous year's numbers faded out of the year-on-year comparison.
| Month | YoY CPI Inflation |
|---|---|
| July 2025 | 4.07% |
| August 2025 | 3.06% |
| September 2025 | 5.77% |
| October 2025 | 6.24% |
| November 2025 | 6.15% |
| December 2025 | 5.61% |
| January 2026 | 5.80% |
| February 2026 | 6.98% |
| March 2026 | 7.30% |
| April 2026 | 10.89% |
| May 2026 | 11.66% |
Across these eleven months, average YoY inflation came to roughly 6.7%. June 2026 — the final month of the fiscal year — wasn't yet released at the time of writing; PBS typically publishes each month's figure in the first days of the following month. Check the live CPI inflation tracker for the complete, continuously updated series and the full FY2025-26 average once it closes.
Frequently Asked Questions
🧮 See it in action: Want to know what your money from a specific year is really worth today? Use our Inflation Calculator to convert any past Rupee amount into today's purchasing power using this same PBS CPI data.
Sources
Figures in this article are compiled from PBS's official CPI methodology and monthly press releases, distributed via the IMF's SDMX Central data feed. PBS occasionally revises provisional figures, so always cross-check the latest month against the official release.
- Pakistan Bureau of Statistics — official CPI, SPI & WPI releases
- IMF SDMX Central — Pakistan CPI data distribution