Stakeholders see monetary tightening tomorrow

Ahead of the State Bank of Pakistan’s Monetary Policy Committee meeting on Monday, financial experts expect a 50-basis-point increase, while some stakeholders are calling for a rise of as much as 100 basis points. Dawn reported that the current policy rate is 11.5 per cent, and first-quarter FY27 inflation reached 10.2pc, compared with 4.3pc in the same period last year.

Bankers and analysts cited rising oil import costs amid the Middle East conflict as a risk to inflation, but warned that a larger increase could make borrowing and investment harder. Tresmark CEO Faisal Mamsa described a 50-basis-point move as a balance between addressing risks and limiting harm to growth. Industry groups, including the Pakistan Chemicals and Dyes Merchants Association, instead urged a rate cut, with the Korangi and SITE industry associations asking for a single-digit rate.