KARACHI: Karachi Chamber of Commerce and Industry (KCCI) President Muhammad Jawed Bilwani has urged the State Bank of Pakistan (SBP) to reduce the policy rate by 400 basis points in the upcoming Monetary Policy Committee (MPC) meeting as inflation witnessed sharp deceleration to 4.86 per cent in November.
Drastic policy rate cuts would align real interest rates closer to sustainable levels and make borrowing affordable for businesses and consumers, he said in a statement.
He noted that the drop in inflation in November marked the fourth consecutive month of single-digit inflation after over two years of high inflationary pressures. The SBP has reduced the policy rate from 22pc to 15pc since June.
However, the current interest rate remains relatively high compared to regional peers such as India (6.5pc), Vietnam (4.5pc), and Bangladesh (10pc), he said, adding that high interest rate continues to suppress private sector credit growth and stifle economic activity, placing Pakistan at a competitive disadvantage.
Published in Dawn, December 13th, 2024
