On Monday, the central bank made a significant announcement, SBP unchanged key policy rate at 22% stating that the key policy rate, which determines the cost of lending for banks, would remain unchanged at 22 per cent.
This decision came during the central bank’s first meeting following the implementation of a new loan program by the International Monetary Fund (IMF). The State Bank of Pakistan (SBP) had scheduled this meeting to review its key policy rate and assess its appropriateness at the current historically high level of 22%. The aim was to curb inflation and support economic growth, and the review would determine whether further rate hikes were necessary.
State Bank of Pakistan (SBP) Governor, Jameel Ahmad, addressed the media and provided clarity on the decision to maintain the policy rate. He mentioned that the rate was being kept steady due to the drop in inflation reading for June. This decrease in inflation was particularly notable as it came after the inflation rate had reached a six-decade high of 38% in May earlier in the year.
The decision to maintain the key policy rate at 22 per cent is a crucial move by the central bank in its efforts to balance inflation and support economic growth in the country. By closely monitoring economic indicators and inflation trends, the SBP aims to make informed decisions that will benefit the overall economic stability of Pakistan.