The State Bank of Pakistan (SBP) increased the key interest rate by 100 basis points, taking it to 11.5%.
“The Monetary Policy Committee has decided to increase the policy rate by 100 basis points to 11.50%, effective April 28, 2026,” the State Bank of Pakistan (SBP) said in a statement.
The move was largely in line with market expectations, as analysts had anticipated a rate hike amid rising geopolitical tensions in the Middle East. These tensions have pushed up global energy prices, fueling concerns about a renewed surge in inflation.
The Monetary Policy Committee (MPC) in its meeting today decided to increase the policy rate by 100bps to 11.50 percent with effect from April 28, 2026.
For details: https://t.co/YCMJZMgnrW#SBPMonetaryPolicy pic.twitter.com/tMUPk1wEW1— SBP (@StateBank_Pak) April 27, 2026
The Monetary Policy Committee (MPC) said in its statement that the prolonged conflict in the Middle East has heightened risks to the macroeconomic outlook. It said that global energy prices, freight costs, and insurance premiums remain well above pre-conflict levels, adding pressure to the external environment.
The committee also pointed out that ongoing supply chain disruptions have further increased uncertainty in global and domestic markets.
While recent economic data has largely aligned with the MPC’s expectations, it warned that the full impact of these global developments will become more evident in key economic indicators in the coming months. In this context, the committee expects inflation to rise and stay above the target range over the next few quarters.
As a result, the MPC decided that maintaining a tighter monetary policy stance was necessary to anchor inflation expectations and prevent second-round effects from the current supply shocks. The goal, it added, is to gradually bring inflation back within the desired target range.
At its previous meeting on March 9, 2026, the Monetary Policy Committee had maintained the benchmark policy rate at 10.5%, also in line with market expectations.
