Govt Expects Inflation to Increase Next Month

The government expects inflation to remain between 1.5-2.0 percent in April 2025, with a possible rise to 3.0-4.0 percent by May 2025. In its Monthly Economic Update & Outlook for April, the finance division highlighted that CPI inflation eased to 0.7 percent YoY in March 2025, down from 1.5 percent in February and 20.7 percent in March 2024. However, despite inflation projected to remain between 1.5-2.0 percent in April, the government sees the possibility of inflation rising by next month. The report further said that the outlook for LSM may improve gradually in coming months, with recovery expected to be gradual amid continued YoY contraction and recent MoM decline. It said that improvements in high-frequency indicators, such as rising automobile output, raw material imports, and a more accommodative monetary stance. indicates cautious optimism. Improved weather conditions and increased water availability are likely to support higher crop yields and better farming conditions contributing to overall economic growth, it added. Moreover, exports and remittances are expected to maintain their upward trend in the coming months keeping the current account within manageable range.