Pakistan SBP policy rate decision, 14 Sept 2026

Hold at 11.5%

The Monetary Policy Committee has now held the policy rate at 11.5% for two consecutive meetings after its easing cycle paused. CPI inflation just surged to 11.15% y/y in August, more than tripling from 3.56% a year earlier, driven by a government fuel-cost pass-through policy, a 20.17% jump in transport costs, and a 13.89% rise in food prices (onions +46%, eggs +12%) tied to provincial wheat-supply failures. That surge is running well above the IMF programs 8.4% inflation forecast for the fiscal year, arguing against a cut. But SBP has historically preferred to observe further prints before reversing direction, real rates remain only modestly positive rather than deeply negative, and the rupee has stayed stable (around 277.5 to 278.65 per USD) with reserves near $17.1bn -- none of which forces an immediate hike. Hold is the more likely outcome; a hike is the main risk to this call if September data confirms the surge wasnt a one-off.