The All Pakistan Business Forum has flayed the State Bank of Pakistan
The All Pakistan Business Forum has flayed the State Bank of Pakistan for jacking the key interest rate by 50 basis points to 6.5% for the next two months on the excuse of dealing with emerging inflationary pressure in its Monetary Policy. He said that this is the second surge in the rate since January 2018 when the central bank increased the then four-decade low rate of 5.75% to 6%. Cumulatively, it has revised up the rate by 75 basis points in the second half of current fiscal year 2018. The rate has now hit a three-year high of 6.5% and comes as #Pakistan prepares
#APBF president Ibrahim Qureshi said the #SBP had adopted a wrong way of dealing with inflation as 50 basis points increase in discount rate would jack up the cost of doing #business that would ultimately hit the economic growth.
With weaknesses in private capital inflows continue to persist, the Central Bank should cut policy rates to spur growth, as cut would infuse confidence in the business community and propel #economy which was hostage to the past policy of austerity. “The businessmen expecting the cut in interest rate, as the rate cut could help boost private sector growth.” He also complained that lending to private sector by the commercial banks during the current fiscal year has not picked up pace.