Industrialists warn against policy rate hikes

Industrialists and analysts have cautioned that a policy-rate increase would add to manufacturing expenses and could push businesses to charge consumers more. Business Recorder reported that the market expects a change at the State Bank of Pakistan’s Monetary Policy Committee meeting on Oct 26, 2026; the rate currently stands at 11.5 percent.

Economic analyst Ateeq Ur Rehman said higher financing costs could curb borrowing by businesses, farmers and homebuyers, while making mortgages less affordable. He also warned that exporters already face difficulty funding working capital and raw materials, alongside shipping costs that have risen nearly 200 percent. Ur Rehman urged the committee to lower the rate, arguing that SMEs, which contribute around 45 percent to GDP, need accessible finance.