KARACHI: The State Bank of Pakistan has decided to maintain the current 5.75 percent interest rate for the next two months, Governor SBP Ashraf Mahmood Wathra announced here Saturday.
Holding a news conference here, Wathra said energy and economic conditions of the country had significantly improved and all economic indicators were positive. He said recently imports of the country increased by 1.2 percent, which would boost productivity.
The SBP governor, however, said that exports will have to be increased to control the remittances deficit.
“The average inflation clocked in at 3.9 percent during the first half of the year, lower than the earlier projections due to smooth supply of perishable items, stable exchange rate, and government’s absorption of the impact of higher international oil prices,” the SBP said in a press statement earlier.
“The current trends suggest that the actual inflation would be lower than the target rate of 6percent in FY17.”
Healthy credit expansion, along with higher production of Kharif crops, visible improvements in energy supply, and upbeat business sentiments signal recuperating real economic activities, it read.
“Large-scale manufacturing grew by 3.2 percent during the first five months of the current fiscal year and further increase is expected on account of growing infrastructure spending and recent policy support for export oriented sectors,” the central bank stated.
The SBP’s monetary policy committee, based on assessment of above mentioned developments and after detailed deliberations, had decided to keep the policy rate unchanged at 5.75 percent, the statement added.