According to market experts, the interest rate in Pakistan is likely to decrease by two percent due to the recent decline in inflation.
The State Bank of Pakistan’s Monetary Policy Committee will be held today, after which the new policy will be announced.
Currently, the interest rate across the country stands at 22 percent. However, due to a reduction in inflation, a 2 percent decrease in the interest rate is possible.
In April, the State Bank of Pakistan (SBP) decided to keep the policy rate unchanged at 22 percent for the seventh consecutive session.
The announcement came after a meeting of the bank’s Monetary Policy Committee (MPC).
In a statement, the MPC stressed on continuation of the current monetary policy stance to bring inflation down to the target range of 5 – 7 percent by September 2025.
The macroeconomic stabilization measures are contributing to considerable improvement in both inflation and external position, amidst moderate economic recovery it stated. However, the committee viewed that the level of inflation is still high.
At the same time, global commodity prices appear to have bottomed out with resilient global growth. The recent geopolitical events have also added uncertainty about their outlook. Moreover, the upcoming budgetary measures may have implications for the near-term inflation outlook the statement noted.
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