The State Bank of Pakistan’s (SBP) Monetary Policy Committee (MPC) is holding a crucial meeting today to decide the country’s key policy rate.
Key Highlights:
-
Rate Decision Expected:
- Market analysts are largely expecting a 50 basis points (bps) cut in the policy rate, which would bring it down to 10.5%.
- The final decision will be announced by SBP Governor Jameel Ahmad at a press conference later today.
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Falling Inflation Supports a Cut:
- Inflation has dropped sharply. The Consumer Price Index (CPI) stood at 3.2% in June 2025, down from 3.5% in May and 12.6% in June 2024.
- Lower inflation means prices are stabilizing, giving the SBP room to ease rates.
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Current Account Surplus:
- Pakistan recorded a $328 million current account surplus in June 2025, compared to a deficit in the same month last year.
- For the fiscal year 2025, the country posted a $2.1 billion annual surplus, the highest in 22 years.
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Foreign Reserves Strengthen:
- SBP’s foreign exchange reserves rose to $14.51 billion by June 30, 2025, up by $5.12 billion during FY25.
- Reserves have also surpassed the IMF’s target, reaching their highest level since 2018.
Why It Matters:
A rate cut would lower borrowing costs for businesses and individuals, help stimulate economic growth, and reduce government borrowing costs. Today’s decision will signal how confident the SBP is about Pakistan’s economic outlook.
Stay tuned to AamAwaam.com for live updates from the SBP press conference.
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