KARACHI – All attention is focused on the State Bank’s upcoming monetary policy announcement, with experts anticipating a possible 2 percent rate cut as inflation declines.
The Monetary Policy Committee (MPC), led by the SBP Governor, will meet today to assess both domestic economic conditions and global trends before setting the policy rate.
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With inflation in single digits, the central bank is expected to reduce the rate from 17.5 percent to around 15.5 or 16 percent. Major firms and trade unions have called on the State Bank to lower the interest rate by 400-500 basis points to boost trade and industrial growth.
The president of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) criticized the current monetary stance relative to core inflation, urging an immediate cut to promote exports. A strong case for a substantial rate cut is supported by core inflation at 7.2 percent in October and projections of falling global oil prices.
A reduced interest rate would enable exporters to compete more effectively in regional and global markets by lowering capital costs.
As the announcement approaches, all eyes remain on the State Bank’s decision regarding this anticipated rate adjustment.
