KARACHI, September 15, 2026: The State Bank of Pakistan (SBP) has kept its policy rate unchanged at 11.5 percent, with the Monetary Policy Committee taking the decision at its meeting on September 14 amid rising inflation, elevated global commodity prices and geopolitical uncertainty.
The Institute of Cost and Management Accountants of Pakistan (ICMA), in its latest Monetary Policy Review, termed the decision appropriate, observing that current inflationary pressures are increasingly driven by supply-side factors. Headline inflation climbed to 11.1 percent in August 2026 from 9.2 percent in July.
A key element of the ICMA review is its Supply Shock Resilience Index (SSRI), which measures Pakistans ability to absorb external supply shocks. The index improved to 0.65 in July 2026, placing the country in the High Resilience category, compared with weak resilience levels recorded during 2022-23.
However, ICMA noted that the improvement remains uneven. Exchange-rate stability currently provides the strongest buffer, while reserve adequacy, export coverage, remittance coverage and food-import resilience remain at moderate levels.
According to ICMA, the improved resilience gives Pakistan some capacity to absorb temporary external supply shocks without automatically resorting to monetary tightening. However, further policy action could become necessary if external pressures result in persistent inflation or renewed exchange-rate instability.
Business leaders consulted by ICMAs Research & Publications Department offered varied but broadly cautious views on the policy decision.
Asfandyar Farrukh, Chairman, Chainstore Association of Pakistan, termed the decision appropriate and called for gradual reductions in interest rates alongside fiscal, tax and energy-sector reforms.
Usman Shaukat, President, Rawalpindi Chamber of Commerce & Industry, described the decision as prudent but pointed out that high financing costs continue to constrain investment and small and medium-sized enterprises (SMEs). He supported gradual monetary easing as external pressures moderate.
Zulfiqar Alam, CEO, Pakistan Housing Finance Company Limited, described the unchanged rate as a cautious pause, noting that supply-driven inflation limits the effectiveness of further increases in interest rates.
Dr Imran Batada, President and CEO, Pakistan Freelancers Association, said improving external conditions reduce the need for an immediate monetary response, but maintained that high borrowing costs continue to affect SMEs, technology investment and freelance businesses.
Faisal Sharif, Director, South Asia Region, GAC Group, said the decision was broadly anticipated and represented a measured response to higher global fuel prices and tensions in the Middle East.
Meanwhile, Atif Ikram Sheikh, President, Federation of Pakistan Chambers of Commerce and Industry (FPCCI), termed the current policy rate highly contractionary and called for a single-digit rate to lower financing costs and support industrial and export activity.
ICMA observed that economic activity showed signs of recovery during July, while private-sector credit expanded by 13.4 percent. Nevertheless, the institute stressed that continued external vulnerabilities require stronger foreign-exchange buffers, higher export and remittance inflows, improved food and energy supply management and diversification of critical imports.
The institute said the 11.5 percent policy rate represents a cautious balance between containing inflation and supporting economic recovery. It emphasized that monetary policy alone cannot address supply-side pressures and should be complemented by targeted structural measures to strengthen Pakistans resilience against external shocks.
