Karachi: The State Bank of Pakistan (SBP) has cut its policy rate by 100 basis points to 12%, signaling a cautious approach to monetary policy aimed at fostering sustainable economic growth. This decision comes alongside a revision of the inflation forecast, which is now expected to fall within the range of 5.5% to 7.5%.
According to a statement by AKD Securities Limited, the SBP’s monetary policy committee has not only adjusted the policy rate but also revised its current account assumptions. The forecast now anticipates a range from a surplus of 0.5% to a deficit of 0.5% of GDP for the fiscal year 2025.
The statement also projects that the SBP will further reduce interest rates by an additional 250 basis points to 9.5% during the remainder of the calendar year 2025. Most of these adjustments are expected to occur in the first half of the year.
The downward revision in inflation forecasts and anticipated easing of interest rates could provide significant relief to the country’s economy, potentially paving the way for sustained economic progress.
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