Pakistan’s Central Bank reduced interest rates, know what will be its benefits?

Pakistan: Of Jammu and Kashmir Pahalgam There is an atmosphere of tension between India and Pakistan these days in view of the terrorist attack in After this terrorist incident, India took many strict action against Pakistan, which is no less than a shock for the neighboring country. However, in the meantime, 25 crore population of Pakistan has breathed some relief. Let us give you complete information about it.

Central bank reduced interest rates

In fact, on Monday, the Central Bank of Pakistan has reduced the policy interest rate to 11 percent with a cut of 100 basis points. The reason for the condition of some improvement on the inflation front was given behind this. Bank of Pakistan (SBP) said that its monetary policy committee (MPC) has decided to reduce the interest rate from 12 percent to 11 percent.

Pakistan has seen a decline in inflation for the last six months. The annual inflation rate in April has declined by 0.3 percent. After this, people were expecting the interest rate cut here. Pakistan’s central bank is constantly cutting the policy rate and in June 2023 it has been reduced to 10 percent from 22 to now.

22 percent high level in June 2023

Let us know that this interest rate reached 22 percent in June 2023 with an increase of 100 basis points, in which the central bank did not make any changes 6 consecutive times. After this, from June 2024, the bank has continuously cut the interest rates. However, in March, it was retained at 12 percent, making no changes in it. The new deduction in the interest rate will be effective from May 6, 2025.

Effect of interest cuts cut

Interest rate cuts are expected to have a better impact on Pakistan’s economy as it will make it easier for businesses and consumers to take loans, investment will be boosted. This will also help in keeping inflation under control.

This decision of the Pakistani central bank was taken before the decision on the next installment of $ 1 billion under the bailout package of $ 7 billion of the International Monetary Fund.

In this matter, India came forward from India

Pakistan has surpassed India in terms of reducing interest rates. The Reserve Bank has so far cut the policy rate by 50 basis points, out of which 25 basis points were cut in February and 25 basis points in April.

Now a research by State Bank of India (SBI) has revealed that in the current financial year, the RBI repo rate can cut 125 basis points. Out of this, 75 basis points are expected to be cut in June and August. Whereas in the second half of the current financial year, there may be a cut of 50 basis points.

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