KARACHI: The Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) is meeting in Karachi today to decide the benchmark interest rate for the next three months. The meeting comes at a crucial time as policymakers assess the country’s economic outlook and inflation trends.
SBP Governor Jamil Ahmad will chair the meeting. Committee members will review key economic indicators, including inflation, foreign exchange reserves, economic growth, and external sector performance. The outcome of the meeting will provide direction for monetary policy in the coming quarter.
Economic Conditions Under Review
The MPC will examine recent developments in domestic and global markets before announcing its decision. Analysts believe the central bank may consider maintaining the current policy rate due to improving economic conditions and easing external risks.
The latest policy review took place on April 27, 2026. At that meeting, the SBP increased the benchmark interest rate by 100 basis points to 11.5 percent. The central bank cited rising geopolitical tensions and concerns about inflationary pressures as the main reasons for the increase.
Global Developments Ease Market Concerns
Meanwhile, global conditions have shown signs of improvement over the past month. Analysts note that fears of a prolonged regional conflict have declined. In addition, prospects for a diplomatic agreement between the United States and Iran have improved.
A ceasefire remains largely intact despite occasional attacks by both sides. Iran also launched strikes on US military bases in several Gulf countries. However, ongoing diplomatic efforts have helped calm financial markets and reduce uncertainty. Consequently, investors are closely watching the SBP’s decision for signals about the future direction of interest rates and economic stability in Pakistan.
