Business community split over SBP’s decision to keep policy rate unchanged

The business community in Pakistan has split over the State Bank of Pakistan's (SBP) decision to maintain the policy rate at 11.5 per cent. While some support the move, others call for further cuts to stimulate investment and industrial activity. The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) expressed disappointment with the decision, stating that trade and industry are suffering due to stagnation.

The FPCCI warns that holding the benchmark interest rate at a high level continues to stifle economic activity and undermine industrial revival efforts. They argue that the central bank should have utilized its powerful tool of monetary policy to provide relief, as trade deficit has increased by 18.1 per cent in July-August 2026 compared to the previous year.

The Overseas Investors Chamber of Commerce and Industry (OICCI) defended the decision, claiming it was prudent and balanced given elevated inflation, robust foreign exchange reserves, and uneven industrial recovery. The chamber urged the government to reinforce monetary stability through fiscal discipline, energy-cost rationalisation, tax predictability, and expedited reforms to boost competitiveness, investment, and sustainable growth.

The Rawalpindi Chamber of Commerce and Industry also supported the decision, blaming global inflationary pressures from the Iran conflict for pushing up international energy and commodity prices, causing slowdowns in industrial activity and exports.