MPC: How the SBP’s language has changed over 21 years

A review by Mettis Global finds that the State Bank of Pakistan’s monetary policy statements have increasingly focused on inflation expectations and related indicators over the past two decades. Comparing statements from July 2005 to September 2026, the analysis counted key terms per 10,000 words and found that references to inflation expectations have been about five times as frequent since 2017 as during 2005-2016.

References to core inflation and the current account are now nearly three times as common, while real interest rate appears more than four times as often. By contrast, exchange rate was absent from all six statements issued in 2026; the word vigilant has not appeared since July 2014. Cautious returned in March 2024, before the SBP began easing from its 22% peak.

The review also notes that Covid-related language featured heavily in 2020 and accommodative peaked in 2021. Geopolitical and Middle East references rose in 2026, following an April increase of 100 basis points that took the policy rate to 11.5%. The rate had been 9% in 2005, fell to 5.75% in 2016-17 and reached 22% in 2023-24; the report was published ahead of the MPC’s October 26 decision.