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NewsState Bank's announcement to set the interest rate at 20 percent

State Bank’s announcement to set the interest rate at 20 percent

Karachi (Sabah News) The State Bank has increased the basic interest rate by 3 percent, after which the interest rate has reached the highest level in the country’s history at 20 percent, which is the highest rate since 1996. According to the statement issued by the State Bank. The Monetary Policy Committee decided in the meeting that the interest rate will be increased by 300 basis points to 20%. The statement said that this decision is a manifestation of deterioration in expectations regarding inflation and external and financial balance. The central bank said that The Monetary Policy Committee believes that this rate is warranted to keep inflation within the medium-term estimate of 5 to 7 percent. The statement said that the Monetary Policy Committee has indicated that a reduction in the current account deficit is necessary but Therefore, serious efforts are required to improve the external situation. The statement emphasized that any kind of financial deterioration will affect effective monetary policy in achieving the objective of stable prices. Earlier, the State Bank of Pakistan It was informed that the meeting of the Monetary Policy Committee will be held on March 2. On January 23 also, the State Bank of Pakistan will increase the interest rate by 100 basis points. The interest rate was increased after which the interest rate reached 17 percent. While giving a press conference in Karachi, Governor State Bank Jameel Ahmed said that the Monetary Policy Committee has increased the interest rate from 16 percent to 17 percent. There has been some moderation in inflation in 2 months, but still there is a trend of continuous increase in core inflation. He said that the current account deficit is still there because the new funds that we were expecting have been delayed. Due to which there is continuous pressure on foreign exchange reserves. He said that the recent forecast of global economic development by the IMF and the World Bank is showing a decline, which has caused uncertainty in the international market. The situation remains which affects our market. Jameel Ahmad said that the Monetary Policy Committee decided to increase the policy rate after a detailed analysis of the external and financial position of the country. He said that the real sector In terms of growth, the State Bank had forecast it to be 2 percent in its monetary policy last month, but it is now expected that the external deficit will slow down. There is some risk because of Hey, so there may be some downside pressure

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