Business Desk 
Nov 05, 2024
Against the backdrop of dropping inflation, the State Bank of Pakistan (SBP) took down the key policy rate for the fourth consecutive time on Monday.
Slashed 250-basis-point to 15%, the new policy rate will come into effect from November 5, 2024, while reflecting on growing economic prospects for the country.
New policy rate in Pakistan
According to The News, the drastic plunge in inflation surpassed expert estimation, which in October nearly touched the medium-term target bar set by SBP.
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The Monetary Policy Committee (MPC) also outlined sinking inflation led by stable food prices, favourable global oil conditions and local tariff adjustments.
Although inflation fluctuation is bound to persist, the MPC expects it to fall within the 5–7% target range soon.
The SBP attributed the interlinked ease in inflation and policy rate to other developments that took place recently, including the grant of Pakistan’s Extended Fund Facility by the IMF, which propelled economic confidence.
Rising investor confidence and lower government yields were other factors that helped MPC reduce the interest rate.
