We understand that's PWM and is not true voltage coming out of the PIN. Just wondering this is the reason? Any way to setup a closed loop monitoring to give exact output?
Digital multimeters use slow integrating analog-to-digital converters - these sum the input voltage over perhaps 1/4 of a second and then display the average. With PWM at 1kHz a DMM will fairly accurately show the average level as you have observed. This slowness is useful for situations like this (a fast ADC would cause the displayed value to jump all over the place - hard to interpret)