SBP’s Monetary Policy Committee to Convene on June 16, 2025

The State Bank of Pakistan (SBP) has announced that its Monetary Policy Committee (MPC) will hold a meeting on Monday, June 16, 2025, to determine the policy rate.

According to the SBP, the Monetary Policy Statement will be disseminated through a press release on the same day as the meeting.

Previous Policy Rate Adjustment

During its most recent assembly on May 5, 2025, the MPC decided to lower the policy rate by 100 basis points (bps), bringing it to 11%. This rate marked the lowest point since March 2022, when it stood at 9.75%. Since June, the central bank has reduced the rate by a total of 1,100bps from its peak of 22%.

Factors Influencing the Decision

In the prior meeting, the MPC observed a significant decrease in inflation during March and April. This decline was largely attributed to reductions in government-regulated electricity prices and a continuous downward trend in food inflation.

Furthermore, core inflation also experienced a decline in April. This primarily reflected advantageous base effects amidst relatively stable demand conditions.

The MPC concluded that the inflation outlook had improved further compared to the prior assessment.

However, the committee acknowledged that substantial global uncertainty surrounding trade tariffs and geopolitical events could present challenges for the economy. Consequently, the MPC stressed the significance of maintaining a carefully balanced monetary policy approach.

Data from the Pakistan Bureau of Statistics (PBS) indicated that the Consumer Price Index (CPI)-based inflation rose to 3.5% year-on-year in May 2025, compared to 0.3% in the preceding month and 11.8% in May 2024.