State Bank of Pakistan's First Monetary Policy Announcement of 2026 on Jan 26

At a meeting of its Monetary Policy Committee (MPC) on January 26, 2026, the State Bank of Pakistan (SBP), the country’s central bank, is expected to make its first monetary policy announcement of the year. In order to determine the key policy interest rate, which affects borrowing costs, inflation, economic growth, and financial market conditions, this committee convenes on a regular basis to evaluate the state of the economy. This session is one of several scheduled dates for the MPC’s current fiscal year 2025_2026. Press conferences usually follow important meetings, such as January 26. The policy rate, also known as the interest rate, was last lowered to 10.5 percent in December 2025. Despite expectations of a hold, the MPC shocked many market observers by lowering it by 50 basis points (bps). Signs of declining inflation and improving macroeconomic conditions were reflected in this easing. Surveys of economists and financial market players prior to the January 26 meeting reveal high expectations that the SBP will lower the policy rate even more. Approximately 80% of participants in Topline Pakistan Research’s most recent Monetary Policy Survey anticipate a rate cut at the first MPC meeting in 2026. Of them, 56.4 percent predict a 50 bps cut, 15.4 percent a 100 bps cut, 5 percent a 25 bps shift, and 3 percent even a 75 bps cut. Just 20% of respondents believe the MPC will maintain the current rate. The PKR/USD exchange rate has been largely stable, offering some macroeconomic relief; remittance inflows have strengthened Pakistan’s external account; and recent inflation readings have been softer than anticipated, relieving pressure on the central bank, according to analysts. In conclusion, markets and investors are eagerly awaiting the MPC announcement on January 26 since it will not only determine the policy interest rate but also convey the central bank’s current perspective on inflation, economic recovery, and Pakistan’s monetary policy direction for 2026.