KARACHI: In line with the market expectation, Pakistan’s central bank has increased the benchmark interest rate by 100 basis points to 9.75% on Tuesday, in a bid to contain runaway inflation, which threatens to destabilise the economy.
The Monetary Policy Committee (MPC) met today for the first time after Pakistan reached a staff-level agreement with the International Monetary Fund (IMF) under the sixth review on November 22, 2021.
Today’s meeting was one of the two additional meetings that the central bank had scheduled last month when it jacked up its benchmark policy rate by 150 basis points to 8.75%, largely in line with the market expectation, because of risks related to inflation.
Financial pundits had earlier predicted that the central bank’s monetary policy committee (MPC) will today raise the policy rate by 100 basis points to control soaring inflation in Pakistan.
It is pertinent to mention here that the interest rate is a tool available with the central bank to control inflation, do away with the unnecessary rupee movement and give a direction to the national economy. APP
