In February 2025, Pakistan’s Business Confidence Index (BCI) rose by 2.8 points, reaching 58.1, according to the latest Business Confidence Survey (BCS) conducted by the State Bank of Pakistan (SBP) in partnership with the Institute of Business Administration (IBA).
The boost in confidence was evident across both the Industry and Services sectors.
The BCI for the Industry sector climbed by 1.7 points, reaching 55.2, while the Services sector saw a stronger surge, rising by 3.2 points to 59.1. The BCI comprises two key components: the Current Business Confidence Index (CBCI) and the Expected Business Confidence Index (EBCI), both of which played a role in the overall increase.
The report further explained that the overall BCI is calculated using a weighted average, where the Industry sector holds a 25 per cent weight and the Services sector holds a 75 per cent weight.
Looking at the CBCI, which reflects the economic environment over the past six months, the index recorded a rise of 3.8 points, bringing it to 56.2. This improvement was driven by gains in both the Industry and Services sectors.
As for future expectations, the EBCI showed a positive outlook for the next six months, climbing by 1.8 points to 60.0 in February. Both sectors contributed to this optimistic forecast.
The Purchasing Managers Index (PMI), another key economic indicator, also increased by 1.5 points, reaching 53.
On the inflation front, the survey revealed that businesses’ Inflation Expectations (IE) rose by 1.9 points, hitting 60.4 in February 2025. This rise was led by the Industry sector, which saw a 1.2-point increase to 61.4, while the Services sector’s inflation expectations grew by 2.9 points to 59.1.
Employment prospects also saw improvement. The Current Employment Index increased by 2.4 points to 53, driven by a 2.9-point rise in the Services sector’s employment index, which reached 54.1. Meanwhile, the Industry sector’s employment index grew slightly by 0.8 points to 49.9.
Looking ahead, the Expected Employment Index saw a modest increase of 0.3 points, reaching 55.1 in February. The Industry sector’s employment expectations rose by 0.7 points to 53.5, while the Services sector recorded a 0.3-point increase to 55.7.
This survey paints a picture of growing business optimism in both present conditions and future prospects, despite concerns over inflation.
