PakStox Outlook

Monetary Policy Committee of the State Bank of Pakistan. has decided to cut the policy rate by 100 bps to 11 percent, effective from May 6, 2025. Policy Decision MPC cut the policy rate by 100 bps to 11% , effective May 6, 2025. Decision driven by sharp decline in inflation , especially food and electricity prices. Core inflation also declined due to a favorable base effect and moderate demand. MPC emphasized a measured stance amid global uncertainty (e.g., tariffs, geopolitics). Macroeconomic Developments Real GDP growth : Q2-FY25 at 1.7% , revised Q1 up to 1.3% from 0.9%. Current account surplus : $1.2 billion in March , cumulative $1.9 billion in July–March FY25. Business and consumer sentiment continued to improve. Tax shortfall widened; global uncertainty led to IMF’s downward revision of global growth forecasts. Real Sector H1-FY25 GDP growth at 1.5% , in line with expectations. Positive momentum in vehicle and fuel sales, electricity generati...