The State Bank of Pakistan (SBP) has kept its benchmark interest rate unchanged at 9.75 per cent in its latest monetary policy and signalled that borrowing costs would remain steady for now, as recent tax increases were expected to curb demand and reduce the country’s budget deficit.
“There’s no need for further tightening at the moment because of the government’s fiscal policy,” SBP Governor Dr Reza Baqir told a news conference on Monday.
He said economic indicators were within the target, which allowed the central bank to keep the interest rate unchanged at 9.75pc.
In its previous monetary policy announced last month, the SBP increased the policy rate by 100 basis points from 8.75pc and revised targets for inflation, current account deficit and growth rate and changed the perception about the rising import bill.
