Karachi: State Bank of Pakistan (SBP) Governor Dr Reza Baqir on Monday (January 24) has announced that monetary policy change shall remain unchanged and the last benchmark interest rate of 9.75% is intact for the ongoing period, news sources reported. The move was made in reaction to the previous monetary policy change’s stabilising effect on national budgetary measures.
According to reports, the fiscal policy decision was made during the Multi-Party Conference (MPC). The meeting resolved to maintain the previous policy rate, which had been raised by 100 basis points to stabilise inflation and control borrowing. The governor stated that the Current Account Deficit (CAD) has stabilised at 4% of GDP as a result of the government’s effective measures, which would assist in economic recovery. When asked about the effects of monetary policy stability, he stated that it will keep borrowing prices stable for the time being and that the new taxes imposed will restrain demand and lower the country’s budget deficit. Furthermore, the state bank has reduced its GDP growth forecast from 5% to 4.5%.
Similarly, it was also said that interest rate stabilisation will keep inflation in the medium-term range of 5% to 7% in order to foster growth and ensure external stability. If further data outturns necessitate a fine-tuning of monetary policy settings, the MPC anticipates that any modification will be minor.
Nauman Ahmad is an imaginative Pisces whose love for literature and nature is unparalleled. When he's not reading or hiking, he's sleeping and eating, which gives him plenty of energy for his next adventure.
