Overview
- The State Bank of Pakistan’s Monetary Policy Committee unanimously kept the policy rate at 11.5% at its July 27 meeting, citing heightened external risks.
- Governor Jameel Ahmad said headline inflation eased to 11.1% in June and the bank expects further moderation, but core and food and energy prices remain elevated.
- The MPC highlighted geopolitical tension in the Middle East and volatile commodity prices as reasons to delay easing because higher oil costs could push inflation and the import bill up.
- Foreign exchange reserves rose above an $18 billion target at end‑June but fell to about $17.3 billion by July 17 after large debt repayments, leaving external buffers sensitive to new shocks.
- The SBP projected FY27 growth of 3.5–4.5% and a current‑account deficit of 0–1% of GDP, and it warned that oil price swings, El Niño flood risks and fiscal slippage are key near‑term risks to watch.