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The State Bank of Pakistan (SBP) chose to maintain the key policy rate at 22 percent.
SBP keeps interest rate unchanged: Following a meeting of the bank’s Monetary Policy Committee (MPC), the announcement was made.
Even though oil prices have recently increased globally, the MPC observed that it still expects inflation to move downward, particularly starting in the second half of this year.
The restrictive monetary policy stance, improved agricultural prospects, and recent administrative and regulatory improvements, according to the MPC, will all contribute to meeting the medium-term inflation objective.
The committee also emphasised the need to maintain a responsible fiscal posture in order to the restrain aggregate demand.
The MPC stated that it will keep an eye on the risks to the inflation forecast and, if necessary, will take the necessary steps to achieve price stability.
In order to the control aggregate demand, the MPC also emphasised maintaining a careful budgetary posture.
This is the important to attain the medium-term target of 5-7% by the end of FY25 and to reduce inflation on a sustainable basis.