State Bank Cuts Interest Rate by 2.5%

The State Bank of Pakistan announced a significant 2.5% cut in its interest rate, reducing it from 17.5% to 15%. The decision comes as part of the central bank’s latest monetary policy statement and reflects a marked decrease in inflation, which is now nearing the mid-term target.

The bank’s statement cited a decline in inflationary pressures as a primary factor, alongside improved economic sentiment following the IMF board’s approval of a new program for Pakistan. This development, according to the State Bank, has decreased uncertainty and bolstered confidence in future external inflows.

With the revised rate set to take effect on November 5, the State Bank expects this adjustment to enhance economic stability and foster sustainable growth. Just last session, the bank’s Monetary Policy Committee had implemented a 2% rate reduction, adjusting it to 17.5%.