SBP maintains the policy rate unchanged at 22%

The State Bank of Pakistan (SBP) has decided to maintain the status quo in the monetary policy rate holding it at 22% in a meeting held on Monday.

“At its meeting today, the Monetary Policy Committee (MPC) decided to keep the policy rate unchanged at 22%, the central bank notified in a statement, adding that the continuity required to bring inflation down to a targeted range of 5-7% by September 2025.

The Monetary Policy Committee (MPC) said that inflation has begun to decline noticeably from the second half of fiscal year 2024, however, it 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.

It added, “This warrants a cautious approach and requires continuity of the current monetary stance to bring inflation down to the target range of 5% to 7% by September 2025. It added that the Committee reiterated that this assessment is also contingent upon continued targeted fiscal consolidation and timely realization of planned external inflows.”