Impact of Inflation on Economic Growth in Pakistan

The main point of this research is to study the existence of inflation economy growth relationship of Pakistan. It is, additional, to examine whether it support or hurts the economic growth in a consistent way or it acts in a different way in unusual levels. Panel time-series data for the period 2005-15 have been taken and analysis is made by applying the method of Co-relation and Linear Regression. A moderate and significant inflation rate and economic growth relationship has been found to be present in the economy of Pakistan. The result of this study shows that current inflation rate is dangerous to the growth of the economy after a firm threshold point. On the root of the analysis, it is suggested to the strategy makers and the State Bank of Pakistan to confine the inflation underneath the 8 percent point and to keep it steady. Thus that it may put forth its helpful impacts on economy growth of the economy.