The State Bank of Pakistan (SBP) announced that its Monetary Policy Committee (MPC) will meet on Monday, June 16, 2025. The purpose of the meeting is to review the economic situation and decide whether to change the policy interest rate. The SBP will issue the official statement through a press release on the same day.
In its last meeting on May 5, the MPC cut the policy rate by 100 basis points to 11%. This was the lowest rate since March 2022, when it stood at 9.75%. The SBP has now reduced the rate by 1,100 basis points since it peaked at 22%.
The MPC had cited a sharp drop in inflation during March and April as a key reason for the rate cut. Electricity prices fell, food inflation eased, and core inflation also declined due to stable demand and a strong base effect. These improvements had encouraged the committee to take a more relaxed stance.
However, the MPC also warned about rising global risks. It pointed to trade tensions and geopolitical uncertainty as challenges that could hurt Pakistan’s economy. Therefore, the committee stressed the need for a careful and balanced approach to monetary policy.
Meanwhile, recent data from the Pakistan Bureau of Statistics shows inflation rising again. The Consumer Price Index rose to 3.5% in May 2025, up from 0.3% in April. Despite being much lower than May 2024’s rate of 11.8%, this rebound could influence the committee’s decision next week.