SBP keeps interest rate unchanged at 7%

sbp, rate, unchanged, neo tv
Source: sbp, rate, unchanged, neo tv

Karachi (Web Desk): The State Bank of Pakistan (SBP) on Friday remained the benchmark interest rate unchanged at 7 percent for the next two months.

“The [Monetary Policy Committee] felt that the existing accommodative stance of monetary policy remained appropriate to support the nascent recovery while keeping inflation expectations well-anchored,” SBP said in a statement.

It is the third time that the central bank has kept its main policy rate unchanged after cutting it by 625 basis points, down from 13.25 percent, at the time the global pandemic hit its economy last February.

The policy rate is revised up or down, or kept unchanged by the SBP in relation to the inflation reading and economic activities.

Low inflation leads to a reduction in the policy rate for ramping up economic activities and vice versa. The rate is left unchanged at a higher level to tone down inflation or on the lower side to support economic growth.