Pakistan increased its benchmark interest rate by 100 basis points, to the highest in more than 24 years, as the economy grapples with raging inflation, supply shortages, dwindling currency reserves and stalled foreign financing.
State Bank of Pakistan raised the target rate to 17%, a move expected by 25 of 43 economists in a Bloomberg survey. The majority of the economists had forecast a hike ranging from 75-200 basis points, while four predicted a hold.
“The inflation pressure persists and on this basis the MPC emphasized to control inflationary pressures,” the central bank governor Jameel Ahmad said in a press conference Monday.
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