KARACHI – The wait for cheaper borrowing costs continues as the State Bank of Pakistan (SBP) keeps the country’s key interest rate unchanged at 11.5% in its first Monetary Policy Committee (MPC) meeting of the new fiscal year 2026-27.
The decision means businesses, consumers, and borrowers will continue to face the same benchmark borrowing environment, as the central bank chooses caution over a rate cut amid inflation concerns, global uncertainty, and rising risks in international oil markets.
The latest announcement came after the MPC’s fifth meeting of the year and was largely expected by financial markets, with analysts predicting that the SBP would avoid any major shift in its monetary policy stance.
Although inflation is showing signs of improvement, the central bank remains concerned about risks coming from outside Pakistan. One of the biggest challenges is the uncertain situation in global markets, especially rising tensions in the Middle East. Any increase in international oil prices could directly affect Pakistan’s import bill, fuel costs, and overall inflation.
Since Pakistan relies heavily on imported energy, a sudden jump in crude oil prices could slow down the progress made in controlling inflation. SBP Governor Jameel Ahmad said inflation pressures are expected to ease further.
He revealed that Consumer Price Index (CPI) inflation is likely to decline in July, while the central bank expects inflation to move towards the upper limit of its 5–7% target range by the end of the current fiscal year.
SBP maintained the policy rate at 11.5% during its previous MPC meeting on June 15, 2026, stating that the existing monetary stance was appropriate to gradually bring inflation down toward its medium-term target.
The latest decision confirms that the central bank is continuing the same cautious approach.
Despite keeping rates unchanged, the economic picture is showing some positive developments.
