Governor State Bank, Jameel Ahmed held a presser on Monday. He stated that the Monetary Policy Committee (MPC) has decided to decrease the interest rate by 100 basic points. The interest rate has fallen from 20.5 to 19.5, Pc (percent).
Moreover, Jameel Ahmed cited the decline in inflation. So decrease in interest rate coincides with the decreased inflation rate. Governor mentioned, “We have noted that the inflation is on a declining trend”.
Meanwhile, the real inflation was better than expected. Moreover, budgetary measures were seen in line, with Budgette FY 25. SBP statement related, “The Committee also assessed that the inflationary impact of the FY25 budgetary measures was broadly in line with earlier expectations.”
Also Read: SBP Maintains The Interest Rate At 22pc
Meanwhile, the SBP also noticed an increase in Foreign Exchange (FX) receives. Furthermore, it is pertinent to consider debt payments and other financial obligations.
SBP statement records, “Considering these developments – along with significantly positive real interest rate – the Committee viewed that there was room to further reduce the policy rate in a calibrated manner to support economic activity, while keeping inflationary pressures in check.”
SBP medium-term target for inflation is 5-7%.
