Governor State Bank of Pakistan Jamil Ahmed has announced that the interest rate will be maintained at 10.5 percent for the next two months, indicating continuity in monetary policy, as gradual stabilization is being seen in inflation.
Talking to the media in Karachi, he said that the current inflation rate is 7.4 percent, which has been significantly controlled compared to last year. He said that the reduction in inflation is a positive development towards economic stability and the central bank wants to keep it under further control through a cautious policy.
Highlighting the situation in the external sector, the Governor State Bank said that the external accounts are in a better position than before. He said that there are clear signs of stabilization in dollar reserves and balance of payments, which has reduced pressure on the economy.
However, he admitted that exports are declining while imports are increasing, which could become a challenge in the coming months. According to him, the main reason for the increase in imports is the increase in consumption of petroleum products as the demand for petrol and diesel is increasing.
Jamil Ahmed also spoke in detail about the debt situation. He said that about $11 billion of external debt is to be repaid during the current fiscal year, of which about $5.75 billion has already been repaid. He clarified that Pakistan has kept the total external debt stable at about $101 billion after 2022.
Furthermore, he said that the State Bank has purchased $22 billion from the open market since 2023 to improve foreign exchange reserves and maintain stability in the market.
According to economists, the decision to maintain interest rates will provide stability for business activities and investment while also helping to control inflation.
State Bank’s important announcement: Interest rate to remain at 10.5 percent, inflation stable at 7.4 percent
