The State Bank of Pakistan (SBP) on Monday decided to keep the policy rate unchanged at 11.5 percent, saying the current monetary policy stance remains appropriate despite rising inflation and growing economic challenges.
In its latest Monetary Policy Statement, the Monetary Policy Committee (MPC) noted that inflation has increased significantly in recent months. Headline inflation rose from 7.3 percent in March to 10.9 percent in April and 11.7 percent in May, driven by higher energy prices, increased transportation and production costs, and a sharp rise in wheat and food prices.
State Bank of Pakistan (SBP) said that although global oil prices have eased following recent positive geopolitical developments, they remain higher than pre-conflict levels. Economic activity has also shown signs of slowing due to elevated prices, austerity measures and prevailing uncertainty.
