Karachi: Pakistan's Consumer Price Index (CPI) is projected to rise to 9.1% year-over-year in July 2026, driven mainly by increased transportation costs and food prices amid geopolitical tensions. The State Bank of Pakistan's Monetary Policy Committee is anticipated to keep the policy rate unchanged at 11.50% due to heightened external risks and uncertainties affecting the global energy trade.

According to JS Global, renewed geopolitical disruptions, particularly in energy trade routes, have raised global concerns, influencing the central bank's cautious approach. The external risks are seen as outweighing the potential benefits of rate cuts, leading to expectations of a status quo on policy rates. The inflation outlook for the fiscal year 2027 includes potential risks, with an alternative scenario suggesting that prolonged geopolitical tensions could temporarily elevate inflation to 9%, before eventually settling near 8% as tensions ease.