SBP projects Pakistan’s FY26 GDP growth at 3.75-4.75%, warns of Middle East war risks

Despite headwinds from global trade-related uncertainty and domestic floods, Pakistan’s macroeconomic stability strengthened further in H1-FY26, as revealed in the State of Pakistan’s Economy, Half Year Report FY26, released on Tuesday. The central bank report noted that the Middle East War poses significant risks to the macroeconomic outlook amid heightened uncertainty, where supply chain disruptions are likely to impact inflation trajectory, external trade and remittance flows, and the economic activity in Pakistan. “However, its impact on overall economic activity is not expected to be significant in FY26,” SBP said.