Dawn
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13:57 Dec 15, 2025
The State Bank of Pakistan (SBP) on Monday reduced its policy rate by 50 basis points to 10.5 per cent, effective from December 16. In a statement, the monetary policy committee (MPC) noted that inflation remained within the 5-7pc target range on average during July-November FY26, though it said that core inflation proved to be “relatively sticky”. “On balance, the inflation outlook remains broadly unchanged, mainly owing to the relatively benign global commodity prices and anchored inflation expectations, amidst [a] prudent monetary policy stance,” the statement read. The MPC further observed that economic activity was increasing based on an improvement in key high-frequency indicators, including a higher-than-anticipated increase in large-scale manufacturing during the first quarter of the 2026 fiscal year. “Nonetheless, the committee noted that the global environment remains challenging, particularly for exports, which may have some implications for the macroeconomic outlook,” the statement read. “In this ...