Federal government suddenly increased interest rates drastically
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The federal government increased the interest rates on loans and advances for developmental purposes.The Ministry of Finance issued a notification for an increase in the mark-up rate for 2023, raising it from 11.20% to 15.58%.
According to the announcement, the interest rate will also apply to provincial governments for development loans, local bodies, the financial and non-financial sectors, and corporations. Additional interest rates will also be applied in federal government commercial departments.
It should be noted that the State Bank of Pakistan (SBP) had decided on September 14th to maintain the overall interest rate at 22%.
The State Bank has stated that this decision is based on the latest inflation figures. In May, inflation was at its highest level at 31%, but it decreased to 27.4% in August, suggesting the possibility of further reduction in inflation.
