Pakistani Central Bank Rate Increased to 17%

January 23, 2023

The State Bank of Pakistan‘s policy rate has been raised a full percentage point to a 24-year high of 17.0%. That’s 10 percentage points above the pandemic low of 7% that prevailed from June 2020 until an initial 25-basis point hike in September 2021. The previous rate hike in November was also by a full percentage point. CPI inflation, which crested in August at 27.3%, surpassed 20% in the final seven months of 2022 and was higher in December at 24.5% than in the previous months. Since Russia invaded Ukraine, core inflation has been climbing, too, and measures of longer-term expected inflation have risen as well. Central bank officials would like to restore the 5-7% inflation target corridor by late 2024.

Copyright 2023, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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