Pakistan CB holds interest rate at 11% for fourth time in a row

Pakistan’s central bank kept its key interest rate unchanged at 11% on Monday, it said on its website, a fourth straight hold, as recent floods had a milder-than-expected impact on crops and inflation while growth and reserves continued to improve.

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The State Bank of Pakistan said the policy decision aimed to maintain price stability as earlier rate cuts continue to work through the economy.

All 10 analysts surveyed had expected the central bank to hold the policy rate steady.

The bank said the overall macroeconomic outlook has improved since its last meeting, with better than expected crop yields, stronger industrial activity, and a rebound in high-frequency indicators.

It revised up its gross domestic product forecast for fiscal year 2026, which ends in June, to the upper half of its earlier 3.25-4.95% range.