With inflation continuing to increase, the State Bank of Pakistan couldhike interest rate by as much as 300 points to 25%, a report said onThursday.
The rate currently stands at 22% which was announced on June 26 this year.The rate is the highest in the country’s history.
However, with economic indicators worsening along with a fall in the valueof the rupee and an increase in the price of petrol, inflation is expectedto increase. The Bank could respond by hiking the rate to 25%, the reportlink said.
The meeting of the SBP’s Monetary Policy Committee is scheduled forSeptember 14. However, emergency meetings have been convened in the past toannounce increases in the interest rate.
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The rate was kept unchanged in the MPC’s last meeting on Jul 31.
Controlling the interest rate is a key measure that the SBP can use tocontrol how much money is being spent in the economy.
