The SBP raised interest rates by another 125 basis points to 15 per cent from 13.75 per cent.
Acting Governor SBP Dr. Murtaza Syed said in a press conference that inflation has become very high, food items have become very expensive, then the government has just made a difficult decision which was the right decision to end electricity and petrol subsidies.
“This is putting a lot of pressure on the common man. The SBP and the Monetary Policy Committee are putting a lot of emphasis on controlling inflation because it is creating a lot of problems for our common man,” he said.
“Controlling inflation is now our most important goal so that our common man can get relief,” he said.
The Acting Governor said that the SBP Monetary Policy Committee has decided to increase the interest rate by 1.25% to 15%.
The central bank had hiked interest rates by 150 basis points to 13.75 per cent in May this year, saying that move would help financial stability.
The SBP’s Monetary Policy Committee had hiked interest rates as well as interest rates on EFS and LTFF loans, while linking the rate to the policy rate, saying it should be adjusted automatically.
The SBP said that the economic growth rate is expected to be between 3.5 % and 4.5% in FY 2022-23.
“The current economic scenario is very difficult and uncertain. The heads of central banks around the world are worried because inflation is rising around the world. Such kind of inflation was faced some 50 to 60 years later,” he said.
According to the data, the inflation rate in May 2022 was 13.76% while in June 2021 the inflation rate was 9.7%.
The target of 8% average inflation for the financial year 2012-13 was not achieved and the average inflation in the last financial year was 12.15%.
SBP Governer stated further that commodity prices have gone up, the inflation will remain for a year, but we will try to stable the current inflation so that the common man is not further affected.”