SBP keeps policy rate unchanged at 11pc

KARACHI(National times)- The State Bank of Pakistan (SBP) on Monday announced that the policy interest rate would remain unchanged at 11 percent. Governor Jameel Ahmad made the announcement while unveiling the new monetary policy, confirming that the Monetary Policy Committee (MPC) agreed to maintain the current rate. “The Monetary Policy Committee (MPC), in its meeting held on October 27, 2025, decided to maintain the policy rate at 11 percent,” the State Bank of Pakistan (SBP) announced in a post on social media platform X. A monetary policy statement released shortly after the SBP’s announcement on X stated that the MPC observed a significant rise in headline inflation to 5.6% in September, while core inflation remained steady at 7.3%. The MPC noted that the economic impact of the recent floods was less severe than previously anticipated, with crop losses contained and minimal supply disruptions. It further highlighted that economic activity had strengthened, supported by robust growth in key economic indicators. According to the statement, the overall macroeconomic outlook had improved compared to the previous assessment. However, the MPC also pointed to persistent uncertainties stemming from volatile global commodity prices, challenging export conditions, evolving tariff structures, and potential domestic food supply issues. Given these factors, and considering the ongoing effects of earlier rate cuts, the MPC deemed maintaining the current rate as appropriate to support price stability.

The statement also outlined several key developments since the last meeting:

The Pakistan Bureau of Statistics revised FY25 GDP growth to 3%, up from 2.7%.
Kharif crop estimates remained close to last year’s output despite flood impacts.
Despite repaying a $500 million Eurobond, SBP’s foreign exchange reserves continued to rise.
Pakistan reached a staff-level agreement with the IMF on the EFF and RSF reviews.
Inflation expectations among consumers and businesses eased in recent SBP-IBA surveys.
Global commodity prices showed mixed trends, with oil prices remaining highly volatile.
The SBP governor is expected to announce the fourth monetary policy of the fiscal year on December 15.