The State Bank of Pakistan (SBP) has announced its latest monetary policy decision, keeping the interest rate unchanged at 11%, according to the central bank’s spokesperson.

The decision was taken during the second meeting of the Monetary Policy Committee (MPC) this year, chaired by Governor Jameel Ahmed. The committee decided to maintain the policy rate at the current level, noting key economic developments since its last meeting on July 30.

Economic developments highlighted

The SBP spokesperson said several important economic changes had taken place since the previous MPC meeting. These include:

A 3% decrease in petrol prices.
The rupee appreciating by 0.5% against the dollar.
A nearly 10% drop in international oil prices, which currently stand at around $63 per barrel.

Inflation trends

According to the SBP, headline inflation in August 2025 eased to 3% year-on-year, compared to 4.1% in July 2025.

Current account and external sector

On the external front, Pakistan recorded a current account deficit of $254 million in July, following a surplus of $328 million in June 2025.

In comparison, the country had posted a deficit of $350 million in July 2024.

Foreign exchange reserves

The SBP further reported that foreign exchange reserves increased by $34 million on a weekly basis, reaching $14.34 billion as of September 5, 2025.

Overall, Pakistan’s total foreign exchange reserves stood at $19.68 billion, with commercial banks holding net reserves of $5.34 billion.

In its previous meeting on July 30, 2025 also, the MPC kept the rate unchanged at 11% amid concerns over rising inflation linked to higher-than-expected gas tariffs. This time, analysts widely anticipated a similar decision due to fresh challenges posed by recent floods.

Brokerage houses had predicted the status quo, noting that inflation could climb in the coming months due to damage to crops, food shortages, and supply chain disruptions.