The policy rate was increased by the Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) by 100 basis points to 21 percent on Tuesday, the highest level since Pakistani financial data collection began by research organisations.
The State Bank of Pakistan (SBP) issued a press release to make the declaration.
The MPC increased the policy rate by 300 basis points to 20 percent at its most recent meeting on March 2. This was the highest policy rate since October 1996. The choice was made in light of higher inflation results as a result of external and fiscal changes.
The increase occurs at a time when widespread and persistent inflationary forces are present. If these continue unchecked, they may contribute to higher inflation forecasts for a longer time period than expected. In order to support future sustainable development, it is essential to stabilise price levels and anchor inflation expectations.