The State Bank of Pakistan’s Monetary Policy Committee (MPC) opted to maintain the policy rate at 22 percent following a meeting held on Monday.
The committee acknowledged the positive impact of macroeconomic stabilization measures on inflation and the external position, amidst a modest economic recovery.
However, despite these improvements, the MPC observed persistently high inflation levels, coupled with stabilized global commodity prices and increased uncertainty due to recent geopolitical events.
Additionally, the committee highlighted the potential impact of upcoming budgetary measures on short-term inflation trends. Therefore, the MPC emphasized the importance of maintaining the current monetary policy stance to achieve the target inflation range of 5-7 percent by September 2025.
Key developments noted since the previous meeting include moderate economic activity recovery, a notable surplus in the current account in March 2024, contrasting inflation expectations between consumers and businesses in April 2024, and cautious monetary policies adopted by leading central banks in advanced economies in response to recent disinflation trends.
