SBP governor expects GDP growth to rise further - Profit by Pakistan Today

The Governor of the State Bank of Pakistan (SBP), Jameel Ahmad, has expressed optimism about the country's economic outlook, indicating an anticipated increase in GDP growth amidst a backdrop of improving economic fundamentals. Speaking at the annual convocation of the Institute of Cost and Management Accountants of Pakistan (ICMA Pakistan), Ahmad highlighted that real GDP growth has rebounded to 3.7% in the fiscal year 2026 and is expected to continue on an upward trajectory in the current fiscal year.

Despite ongoing challenges, Ahmad noted significant progress made since 2022, particularly in managing the effects of various global and regional shocks. He pointed out that, in spite of notable supply disruptions, Pakistan has effectively mitigated their repercussions on the domestic economy. Inflation rates, which have recently seen an uptick, are projected to gradually align with the SBP's target range, bolstered by careful monetary policy measures.

The governor further mentioned the stability of the external account, with forecasts suggesting that the current account deficit will remain contained within 0 to 1% of the GDP. The recovery of real GDP growth, which had previously experienced a downturn in fiscal year 2023, signifies a promising shift in economic performance.

Ahmad emphasized that the enhancements in economic fundamentals and resilience have not gone unnoticed by international credit rating agencies, multilateral institutions, and foreign investors. He reflected on the economic adjustments made during fiscal years 2022 and 2023, asserting that timely and decisive measures, fiscal discipline, and evidence-based policymaking have been instrumental in fortifying Pakistan's economic framework.

He acknowledged the necessity of raising the policy interest rate and maintaining it for an extended period as a strategic response to restore macroeconomic stability and avert a more severe external financing and debt crisis. The governor cautioned against relying on short-term solutions that could jeopardize long-term economic stability.

Ahmad stated that maintaining a positive real policy rate has been effective in reducing inflation from over 30% to within a more manageable range. In addition, he noted that risk-based supervision has enhanced the proactive identification of financial stability risks, with key indicators of the financial sector's adequacy and performance showing improvement despite the prevailing high policy rates.

Addressing the graduates, Ahmad expressed his belief that the knowledge and skills they have attained during their studies, combined with their dedication and commitment to excellence, would play a significant role in shaping Pakistan's economic future. He urged the new professionals to let evidence guide their decisions, adhere to professional ethics, and commit to the sustainable and inclusive development of the nation.

In closing, the governor highlighted the critical importance of the accounting and finance profession in fostering strong institutions, accountability, and informed decision-making. He commended the graduates for their achievements and encouraged them to contribute to sound governance and the responsible management of public resources, wishing them success in their future endeavors.