SBP keeps policy rate unchanged at 22 per cent

ISLAMABAD: The Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) announced its decision on Monday to keep the policy rate unchanged for the sixth consecutive session, maintaining the key policy rate at 22 per cent.

“In approaching today’s decision, the Committee noted that inflation, in line with earlier expectations, has begun to decline noticeably from H2-FY24,” read the press release issued by

“The Committee, however, observed that despite the sharp deceleration in February, the level of inflation remains high and its outlook is susceptible to risks amidst elevated inflation expectations. This warrants a cautious approach and requires continuity of the current monetary stance to bring inflation down to the target range of 5–7 per cent by September 2025.”

““Second, the external current account balance is turning out better than anticipated and has helped maintain FX buffers despite weak financial inflows. Third, while inflation expectations of businesses have shown a steady increase since December, those for consumers have also inched up in March. Lastly, on the global front, while the broader trend in commodity prices remained benign, oil prices have increased; partly reflecting the continued tense situation in the Red Sea,” the statement added.

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The recent decision marks the first policy move by the newly elected government. Additionally, it precedes the International Monetary Fund (IMF)’s final review scheduled from March 14th to 18th for the disbursement of $1.1 billion under the existing Stand-By Arrangement (SBA).

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