SBP governor expects further GDP growth, inflation to ease towards target

Speaking at an ICMA Pakistan convocation, SBP Governor Jameel Ahmad said real GDP growth reached 3.7% in FY26 and is expected to increase further in the current fiscal year. He also expects inflation, which has risen since FY26, to gradually move back towards the central bank’s target range.

Ahmad said the current account deficit is projected to remain between 0 and 1% of GDP, while describing the external account as stable. He attributed lower inflation to a positive forward-looking real policy rate and said earlier monetary tightening and temporary foreign-exchange measures helped restore macroeconomic stability. The governor also reported improving financial-sector performance indicators and said risk-based supervision has strengthened the identification of stability risks.