Pakistan’s c. bank cuts interest rate by 200bps

The monetary policy committee (MPC) of the State Bank of Pakistan (SBP) decided on Monday to reduce the policy rate by 200 basis points to 13 per cent, effective from December 17, 2024.

The decision to hold interest rates follows a decrease in the country’s inflation to 4.9 per cent in November 2024, mainly due to lower food prices and the fading impact of a previous gas tariff increase.

However, the MPC noted that core inflation remains high at 9.7 per cent and inflation expectations are volatile. Inflation may stay unstable before stabilising within the target range.

Attribution: State Bank of Pakistan report

Subediting: Y.Yasser