Pakistan Hikes Interest Rate: Pakistan, which is facing economic crisis, has accepted another condition of the International Monetary Fund. According to the news agency Reuters, the Central Bank of Pakistan may soon increase its interest rates by 200 basis points. To get $ 1.1 billion funding from the IMF, Pakistan has agreed to increase its policy interest rates. State Bank of Pakistan will now have a meeting on March 2 i.e. Thursday to take a decision on this issue. Earlier this meeting was to be held on March 16.
Interest rates may increase by 200 bps
In such a situation, most of the experts of the country believe that in this meeting, SBP can increase by a total of 200 basis points. At the same time, some experts also believe that the policy interest rates may increase by up to 250 basis points. Let us inform that from January 2023 till now, the State Bank of Pakistan has increased its interest rates by 725 basis points.
Continuously increasing inflation in the country
Earlier in the meeting held in January, the Central Bank of Pakistan had increased its interest rates by 100 basis points. After this the rates have reached 17 percent. The country’s Central Bank is constantly trying to reduce the Consumer Price Index. The country’s inflation rate was 27.5 percent in January, which increased to 29 to 30 percent in February. In such a situation, SBP can tighten its monetary policy to control inflation in the country.
Pakistan is forced to meet IMF conditions
Let us tell you that Pakistan is constantly trying to get $ 1.1 billion, a part of the $ 6.5 billion bailout package. It is worth noting that in order to get the package of IMF, the Government of Pakistan has taken many tough steps like increase in tax, cut in subsidy in the last few days.
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