KARACHI: The State Bank of Pakistan (SBP) further tightened its monetary policy on Tuesday, jacking up key policy rate by 100 basis points to a record high of 21% with a view to controlling inflation.
The central bank’s Monetary Policy Committee noted that inflation in March reached 35.4%, and is expected to remain high in the near term. But noted that the early indicators showed that “inflation expectations plateauing, albeit at an elevated level”.
“MPC views today’s decision, along with the cumulative monetary tightening so far, as adequate to anchor inflation expectations around its medium-term target – barring any unanticipated shock. The Committee further observed that Pakistan’s financial sector remains broadly resilient, while economic activity continues to moderate,” stated the SBP.
Read more: Premier Shehbaz chairs second cabinet meeting in two days, as SCP announces poll verdict
