Karachi: The State Bank of Pakistan (SBP) on Monday (October 30) maintained the key interest rate at 22%, citing expectations of a significant decline in inflation in October due to reductions in fuel prices, claimed by a news source on October 31. Read: Construction materials’ price surge despite petrol price drop
According to the details, the SBP Monetary Policy Committee (MPC) noted in its meeting that headline inflation in September rose as anticipated. The decision to keep the rate unchanged was influenced by a decrease in fuel prices by up to PKR 40 per litre, a crucial factor in the rate stability. The SBP expects inflation to decrease in October and continue on a downward trajectory, especially in the second half of the fiscal year. Read: ADB approves funds for Sindh Coastal Resilience Project
While global oil prices remain volatile and uncertainties persist due to the Middle East conflict, the SBP stressed the importance of continuing with a tight monetary policy stance. The committee reiterated its belief that the real policy rate remains significantly positive on a 12-month forward-looking basis, aiming to bring inflation down to the medium-term target of 5-7% by the end of the fiscal year 2024-25.
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