The State Bank of Pakistan (SBP) is expected to keep its policy rate unchanged at 11.5 percent at the Monetary Policy Committee (MPC) meeting scheduled for September 14, 2026, according to a survey conducted by Arif Habib Limited (AHL). The expected decision comes as policymakers assess a combination of improving external sector indicators, stronger economic activity and rising inflation during the opening months of the current fiscal year. The central bank is likely to weigh these developments before determining whether the existing monetary policy stance should be maintained.
According to the AHL survey, a significant majority of respondents expect the central bank to leave the policy rate unchanged at its current level. Around 87.5 percent of respondents anticipate that the SBP will maintain the rate at 11.5 percent, while the remaining 12.5 percent expect a 50 basis point increase. The survey indicates that market expectations are therefore strongly tilted towards stability at the upcoming meeting, although the possibility of a rate increase remains part of the outlook given the recent rise in inflation.
Pakistan’s external sector has shown improvement in several areas, which could support the case for maintaining the current policy rate. The country’s current account deficit narrowed by 38 percent year on year to $328 million in July, while workers’ remittances increased by 13 percent to $3.6 billion during the same month. These developments provide important support to the external position and will likely form part of the broader economic indicators considered by policymakers ahead of the monetary policy decision.
Fiscal performance has also remained supportive, with Pakistan recording a primary fiscal surplus equivalent to 2.9 percent of gross domestic product (GDP) during fiscal year 2026. The surplus was above the target agreed with the International Monetary Fund (IMF), providing an additional positive indicator for the country’s fiscal position. The fiscal improvement, combined with stronger remittance inflows and a narrower current account deficit, may provide the SBP with greater room to maintain the existing policy rate while continuing to monitor other economic pressures.
Inflation, however, remains an important consideration ahead of the September 14 decision. Average Consumer Price Index (CPI) inflation reached 10.18 percent during the first two months of fiscal year 2027, compared with 3.56 percent during the corresponding period a year earlier. The sharp increase represents a significant change in the inflation environment and could influence the central bank’s assessment of monetary conditions. Despite the increase, the SBP is expected to consider whether the rise in inflation is broad based and persistent before making any adjustment to the policy rate.
Economic activity has also continued to provide support to the broader outlook. Large scale manufacturing recorded growth of around 5 percent during fiscal year 2026, representing its strongest performance in approximately four years. The improvement in industrial activity indicates continued momentum in parts of the productive economy and may be another factor considered by policymakers when evaluating the appropriate monetary policy stance.
The SBP’s upcoming MPC meeting is scheduled for September 14, 2026. According to the monetary policy calendar, the Monetary Policy Statement and Information Compendium are scheduled for release on the same day, followed by the Analyst Briefing Slide Deck on September 15. The post MPC press conference is not scheduled for the September meeting, while the minutes of the MPC meeting are expected during the week ending October 9, 2026.
The monetary policy decision will therefore come at a time when Pakistan’s economic indicators present a mixed picture. External sector conditions have improved through stronger remittances and a narrower current account deficit, while fiscal performance has remained above the IMF target and manufacturing activity has strengthened. At the same time, inflation has increased considerably compared with the previous year, making price developments an important consideration for the central bank.
Based on the AHL survey, the prevailing expectation is that the SBP will maintain the policy rate at 11.5 percent rather than introduce an immediate adjustment. However, the final decision will depend on the MPC’s assessment of inflation trends, economic growth, external sector developments, fiscal conditions and other relevant indicators. The September 14 meeting will provide the central bank with an opportunity to evaluate these developments and determine whether the existing monetary policy stance remains appropriate for Pakistan’s economic conditions.
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