State Bank Holds Policy Rate at 11% Amid Middle East Tensions

The State Bank of Pakistan (SBP) has kept its benchmark interest rate steady at 11% as of June 16, holding off after seven rate cuts totaling 1,000 basis points since June 2024  . The Monetary Policy Committee cited rising oil and commodity prices triggered by the Iran‑Israel conflict, which could fuel inflation and strain Pakistan’s external balance  . May’s inflation rose to 3.5%, within expectations, but the committee expects it to remain within its 5–7% target range  . The SBP noted improving economic growth and stable foreign reserves (~$11.7 bn), but flagged risks from widening trade deficits and budgetary pressures