Karachi: The State Bank of Pakistan (SBP) on Friday decreased the country’s key interest rate to 8%, a news source reported. The new rate represents a reduction of 1% from the previous figure of 9%.
Notifying the reduction in the key interest rate, SBP’s Monetary Policy Committee stated that the central bank had decreased the rate keeping in view the current pandemic situation in the country. As per reports, SBP has notified a reduction of 5.25% since March 17.
It further revealed that during the coming months, the SBP expects the inflation rate to go down, in addition to anticipating a reduction in petroleum prices. Meanwhile, the central bank recently announced the provision of loans to health facilities in the country on a 3% mark-up in order to mitigate the effects of the coronavirus spread.
In January, the SBP had left the key interest rate unmoved at 13.25%. It announced a target rate after every two months. This rate serves as a benchmark for the overnight funds in the interbank market. SBP uses this tool to maintain price stability in the country’s economy.