The Monetary Policy Committee of the State Bank of Pakistan on 9 March 2026 kept the policy rate at 10.5 %, judging the current stance appropriate to preserve “hard-earned” price stability even as the Middle-East war has abruptly lifted global fuel, freight and insurance costs and heightened macroeconomic uncertainty. This follows cumulative easing of 150 bp since May 2025, most recently a 50 bp cut in December. The Committee offered no new liquidity measures but noted continued interbank FX purchases that have raised reserves to USD 16.3 bn by 27 February amid a January current-account surplus, leaving the July–January deficit at USD 1.1 bn and allowing a reserve-build target of USD 18 bn by June to remain in sight. Headline inflation accelerated to 7 % y/y in February and core to 7.6 %, and the MPC now sees price gains staying above 7 % through the rest of FY26 and into FY27, with upside risks from volatile energy and food costs and the regional conflict; still, it maintains its FY26 GDP growth forecast at 3.75–4.75 % on the back of firmer high-frequency indicators and PKR 790 bn in private-sector credit expansion by 20 February, even as FBR revenues lag target. The Committee also cited the potential drag from recently announced US global tariffs and reiterated that prudent fiscal policy and faster structural reforms are essential, signalling willingness to respond if risks to inflation or financial stability intensify.
State Bank of Pakistan 2026-03-09
SBP holds policy rate at 10.5%
State Bank of Pakistan’s Monetary Policy Committee on 9 March 2026 left the policy rate unchanged at 10.5 %, pausing after 150 bp of cuts since May 2025 to protect price stability as the Middle-East war drives energy and freight costs and February inflation reached 7 % y/y. The MPC sees inflation remaining above 7 % through FY26, maintained its 3.75–4.75 % growth outlook, noted reserves have risen to USD 16.3 bn toward a USD 18 bn June target, and signalled it is ready to act if price or stability risks intensify.