Lawmakers Hope for SBP Interest Rate to Drop to Single Digits by June 2026
During a meeting of the Senate Standing Committee on Commerce on Monday, lawmakers expressed optimism that the State Bank of Pakistan (SBP) could lower its policy rate to single digits by June 2026. Members highlighted that persistently high interest rates have significantly restricted business activity and limited access to financing for the private sector.
Federal Minister for Commerce Jam Kamal Khan briefed the committee, emphasizing that nearly 95 percent of Pakistan’s business community lacks access to formal financing channels. He noted that elevated interest rates, currently around 18.1 percent, have encouraged investors to deposit funds in banks rather than invest in productive sectors, hampering economic growth.
Committee members stressed that reducing the SBP policy rate would not only support private investment but also improve liquidity in key industries. Lawmakers voiced the need for monetary policies that stimulate business activity while keeping inflation and financial stability in check.
The discussion reflects growing pressure on the central bank to adopt accommodative policies that can revive private-sector investment and promote overall economic growth. If interest rates are lowered to single digits, businesses and investors are expected to benefit from cheaper financing and improved access to credit, potentially boosting economic activity ahead of the next fiscal year.
