The State Bank of Pakistan (SBP) has decided to keep the interest rate unchanged at 11 percent, according to a statement issued on Monday. The decision was made after reviewing current inflation trends and assessing the economic challenges caused by recent floods.
In its statement, the central bank said the monetary policy decision reflects the need to maintain financial stability while supporting economic recovery. The SBP noted that inflation remains a major concern but added that tightening the rate further could restrict growth in key sectors.
Analysts say the SBP’s decision aligns with its cautious approach amid a fragile economic environment. The recent floods have severely affected agriculture and infrastructure, disrupting supply chains and adding pressure to food prices. Maintaining the policy rate, therefore, aims to balance inflation control with growth stability.
The SBP further stated that the current interest rate will help preserve monetary discipline while allowing businesses and industries some breathing space. Economists, however, remain divided some argue that a rate cut was needed to stimulate growth, while others believe the central bank made the right call given inflationary risks.
In related economic updates, Pakistan and Afghanistan recently resumed peace talks in Istanbul, reflecting ongoing regional cooperation efforts that could also influence trade and market stability in the near future.
Financial experts expect the SBP to closely monitor price trends, especially in essential commodities, before making any future adjustments. The next policy review will depend on how the government manages inflation and post-flood recovery efforts.
The decision also reflects Pakistan’s commitment to maintaining economic consistency during a period of regional uncertainty. Stable monetary policy is seen as vital to restoring investor confidence and ensuring long-term fiscal health.
