Interest rates unchanged, foreign exchange reserves expected to increase

Karachi: The State Bank of Pakistan has released a detailed outlook for the country’s economy for the coming months and said that the monetary policy reports will be published within two weeks of the January and July meetings. According to the report, the Monetary Policy Committee in June and July decided to maintain the interest rate at the current level of 11 percent.

The State Bank says that despite the expected increase in remittances, the current account deficit is likely to remain at one percent of the gross domestic product (GDP).  Moreover, foreign exchange reserves are expected to increase to $15.50 billion by December this year, which is considered a positive sign for external payments and import requirements.

The statement said that the country’s economic growth rate during the fiscal year is estimated to be between 3.25 percent and 4.25 percent, indicating a gradual improvement in economic activities.

Experts say that keeping interest rates stable and the expectation of increasing foreign exchange reserves can instill confidence in investors and the business community.