March 10, 2025:The State Bank of Pakistan (SBP) has announced its decision to maintain the policy rate at12.0%, as per the latest Monetary Policy Committee (MPC) meeting held on March 10, 2025.
According to the SBP, inflation in February 2025 was lower than expected, primarily due to a decline in food and energy prices. However, core inflation remains persistent at an elevated level.
Economic activity continues to show signs of improvement, with positive indicators from high-frequency economic data and consumer and business confidence surveys. However, external account pressure is rising due to increasing imports and weak financial inflows.
The SBP noted that the significant reduction in the policy rate over recent months is beginning to show its impact. Moving forward, the central bank aims to maintain a cautious monetary stance to keep inflation within the5-7% target rangeand ensure macroeconomic stability while fostering sustainable economic growth.
The monetary policy rate has seen a downward trend since June 2024, declining from20.5%to the current12.0%, as shown in the SBPs policy rate trajectory.
The SBP reaffirmed its commitment to carefully balancing inflation control with economic growth, ensuring that monetary policy supports long-term financial stability.