Consumer confidence in Pakistan saw a sharp decline in the first quarter of FY2025–26, signaling growing caution among households even as sentiment remains stronger than a year ago. The Consumer Confidence Index (CCI) dropped to 86.4, down from 96.2 in the previous quarter, marking a 10.2 percent decline.
Despite the quarterly drop, confidence levels are still 18.5 percent higher than the same period last year, when the index stood at 72.9, suggesting that broader economic stabilization continues despite short-term pressures.
What the Index Measures
The Pakistan Consumer Confidence Index for Q1 FY26, released in December 2025, offers a detailed snapshot of household sentiment across the country. The report is jointly prepared by D&B Pakistan and Gallup Pakistan, and tracks perceptions of current economic conditions, future expectations, household finances, employment, savings, and inflation.
The findings are based on a nationwide telephonic survey of 2,132 respondents, with a margin of error of ±2.2 percent, providing an independent, data-driven view of consumer sentiment.
Current Conditions Weigh on Confidence
The decline in overall confidence was largely driven by worsening views of present conditions. The current sentiment index fell to 74.7, pushing it into the extremely pessimistic range. Meanwhile, the future outlook index slipped to 98.2, remaining close to neutral — an indication that households still expect some degree of stability in the months ahead.
Inflation Remains the Top Concern
Rising prices continue to dominate consumer concerns. A striking 84.3 percent of respondents reported that the prices of everyday items had increased over the past six months. Reflecting this pressure, the net price indicator plunged from 67.6 to 32.8, highlighting the impact of sustained inflation driven by fuel costs, energy prices, and currency weakness.
Employment Outlook Turns Weaker
Confidence in the labor market also deteriorated. The current employment net indicator fell to 56.5, pointing to widespread perceptions of job market strain. Expectations around future employment weakened as well, underscoring growing anxiety about job security and hiring prospects.
Household Finances Show Relative Resilience
Despite inflation and employment concerns, households remain cautiously optimistic about their personal finances. Around 61.6 percent of respondents expect their financial situation to improve or remain unchanged. The household income net indicator stood at 108.1, with nearly 63 percent anticipating stable or rising incomes.
However, savings sentiment remained muted. The overall savings net indicator was 81.3, reflecting limited disposable income and continued financial strain on households.
Urban Consumers Feel the Pinch Most
The sharpest decline in confidence was observed among urban residents and individuals aged 30 to 49, with their confidence indices falling by 24 to 27 percent. In contrast, younger respondents under 30 remained comparatively more optimistic, particularly when it came to future income prospects.
The Bigger Picture
While the quarterly drop in consumer confidence points to mounting pressure from inflation and labor market uncertainty, the year-on-year improvement suggests that households still see signs of broader economic stabilization. Whether this cautious optimism holds will depend on price stability, job creation, and policy support in the months ahead.