Pakistan hikes interest rate to 17%, highest since Oct 1997

Karachi, Jan 23 : In line with market expectations, the State Bank of Pakistan (SBP) on Monday jacked up the benchmark interest rate by 100 basis points to 17 percent the highest since October 1997, reports said.

SBP Governor Jameel Ahmad, in his maiden monetary policy press conference after assuming charge in August, revealed that the committee has observed that "inflationary pressures are persisting and continue to be broad-based", Geo News reported.

"If these remain unchecked, they could feed into higher inflation expectations over a longer than-anticipated period, therefore the Monetary Policy Committee (MPC) stressed that it is critical to anchor inflation expectations and achieve the objective of price stability to support sustainable growth in the future," he added.

The central bank raised the benchmark interest rate by 100 basis points (bps), taking the total increase to 1,000 bps since September 2021 to counter rising inflation, Geo News reported.