State Bank of Pakistan (SBP) is scheduled to hold its Monetary Policy Committee (MPC) meeting on Oct 27, 2025.

In a Poll conducted by Topline Securities, 85% of the market participant expect policy rate to remain unchanged compared to 72% in last poll. We believe, participants expectations for status quo is owing to recent floods led inflation which is expected to remain sticky over next few months, in line with previous flood trends.The SBP increases the Policy Rate by 100bps

While 15% are expecting a cut of 25bps and above. Within this, 5% are expecting 25bps cut, and 10% are expecting 50bps cut.

Looking back in previous floods of 2010-2011, area under cultivation of major crops i.e. wheat, rice, and cotton was declined in range of 3-18%. While rice production was also affected by ~30% in FY11 as per data from economic survey of Pakistan. While, this time, experts are viewing damage of ~10% to major crops namely cotton and rice.

Topline expects central bank to maintain status quo in upcoming meet owing to higher inflation pattern emanating from recent floods and rising import levels.

Topline analysts further expected central bank to maintain status quo on interest rate front in FY26 as during 2HFY26, the inflation numbers in last few months (Apr May and Jun) might cross 8-9% before reverting to normalized range of 6-7%.

Furthermore, non-oil imports numbers are also on rising trajectory despite higher interest rates of 11% and real rate of over 500-600bps. This signals SBP might continue with status quo approach.

We maintain our interest rate target of 11% during FY26,” Topline said.

6M KIBOR and 6 Months T-Bills have gone up since last MPC meeting: The secondary market yields and KIBOR since last MPC have increased by 13-21bps, suggesting market has changed its perception of any rate cut sooner.

Topline Research conducted a poll of key market participants on expectations over policy rate, average inflation, and PKR USD parity for FY26/Dec 2025.

Policy Rate: On question related to interest rate target for Dec 2025, 66% believe that policy rate will remain unchanged till Dec vs. earlier 41%. While 34% believe that interest rate will come down to 10%. While by Jun 2026, 46% believe rate will come down to 10%, and 27% believe, it will be below at 9% or below. We expect policy rate to remain unchanged at 11% during FY26.

Inflation: On Inflation side, 42% of the respondents believe that inflation will remain in range of 6-7% for FY26, while 32% believe that inflation will be above 7%. We expect Pakistan Inflation to average between 6.5-7.5% for FY26.

Exchange Rate: On currency side, 44% participants are expecting currency in range of Rs282-285 by Dec 2025 and while 42% believe that currency will remain in range of 285-290. We expect currency to clock in at Rs283-288 by Dec 2025 and Rs292-297 by June 2026,” Topline said.