Rehan Shahid 
Apr 27, 2026
The State Bank of Pakistan (SBP0 on Monday announced an increase in its benchmark policy rate by 100 basis points (bps) to 11.5%, opting for cautious tightening as oil price volatility and renewed inflation risks clouded the economic outlook.
The central bank's move came as the Monetary Policy Committee faced a finely balanced decision. As per a Reuters poll, which revealed that six of 10 analysts expected SBP to keep the rate unchanged at 10.5%, while three forecast a 50-basis-point hike and one expected a larger 100-basis-point increase.
"The interest rate has been increased from 10.5 percent to 11.5 percent," said the central bank. Pakistan's CPI inflation quickened to 7.3% year-on-year in March from 7% in February, breaching the SBP's 5%–7% target range.
Some analysts warned that inflation could move towards double digits in the fourth quarter of the fiscal year if external pressures persisted.
Oil prices have remained volatile due to the Iran-US conflict, keeping global markets on edge and raising concerns over Pakistan’s import bill.
The central bank has cut rates by a cumulative 1,150 basis points since June 2024, when they peaked at a record 22%, and last reduced the rate by 50 basis points in January.
