Achi news desk-
ISLAMABAD – The State Bank of Pakistan (SBP) is expected to cut the policy rate by 100-150 basis points in its monetary policy review on April 29. The central bank will cut the policy rate by 100 to 150 basis points in the monetary policy committee meeting is to come.
State Bank of India is expected to cut interest rates to a record amid rising inflation and stagnant economic growth. They say 12-month average inflation is expected to be around 15-16 per cent, making the current interest rate of 22 per cent relatively high.
Sources said cheaper financing could potentially boost economic activity. The current high rate has significantly affected the economy, especially the manufacturing sector In the current financial year, the central bank has maintained its policy rate at 22 percent, pending a slowdown in inflation.
Inflation has indeed started to slow down, reaching 20.pc in March, and a further reduction to 17pc is expected in April, as predicted by the finance ministry and the State Bank Inflationary pressures Some relief will boost economic activity and suspended in FY23 and FY24.
Due to sky-high interest rates making it expensive to borrow from commercial banks, the government borrowed Rs 5.3 trillion in FY24 and was facing debt servicing challenges Overall, to support economic growth a rate cut is considered necessary, in especially since such international organizations as the IMF and the World Bank have predicted that Pakistan’s GDP will grow by 2 percent in FY24.
