The federal government is gearing up to unveil its inaugural budget for the fiscal year 2024–25 in June, amidst a backdrop of various economic challenges.
Each year, federal and provincial government employees anticipate this announcement eagerly, as it typically includes adjustments to their salaries to account for factors such as inflation.
With efforts underway to curb inflation, the government aims to bring it down to a target range of 5–7 percent by September 2025. Recent data shows promising signs, with headline inflation decreasing to 20.7 percent year-on-year in March from 23.1 percent in February.
Similarly, core inflation also saw a notable decline from 18.1 percent in February to 15.7 percent in March, indicating a positive trend.
The State Bank of Pakistan’s Monetary Policy Committee anticipates that this downward trajectory of inflation will persist.
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Historically, both federal and provincial governments have used the budget as a platform to announce salary increments for their employees.
In the upcoming budget for 2024–25, it is expected that the government will announce a 10 percent increase in salaries for employees.
However, the final decision rests with the respective governments, pending a review of recommendations by the finance ministry. If approved, this increment will likely take effect in July 2024, providing relief to government employees amidst economic uncertainties.