The State Bank of Pakistan (SBP) will convene its Monetary Policy Committee on May 5 to review the benchmark interest rate, with analysts anticipating a 50-basis-point cut amid easing inflation and economic stabilization efforts.
The State Bank of Pakistan (SBP) announced Wednesday that its Monetary Policy Committee will meet Monday, May 5, to reassess the country’s key interest rate. A policy statement outlining the decision will follow the meeting, according to the central bank.
Brokerage firm Arif Habib Limited (AHL) projects a 50-basis-point reduction, lowering the rate from 12% to 11.5%, marking a potential shift after the SBP held rates steady in March. At its last meeting, the central bank cited uncertainty in inflation trends, acknowledging February’s lower-than-expected inflation driven by declining food and energy costs.
Read More: SBP Maintains Monetary Policy Rate at 12%
However, the SBP cautioned that volatile food and energy prices could disrupt disinflation, while core inflation—stripping out these categories—remained elevated. AHL contends that sustained inflation declines and a widening gap between inflation and interest rates justify a measured cut to stimulate growth without destabilizing financial markets.
