Pakistan’s Islamic Republic has taken the lead in the interest rate chart.

On March 2nd, 2023, Pakistan’s central bank raised its key interest rate by 300 basis points to 20%, resulting in the highest borrowing costs since 1996. Policymakers cited recent fiscal adjustments and currency depreciation as the cause for a significant decline in the short-term inflation outlook and an increase in inflation expectations.

According to the State Bank of Pakistan, inflation is projected to increase to 27%-29% in the coming months, up from the 21%-23% range seen in November 2022. In order to secure a $1 billion loan from the International Monetary Fund, Pakistan has implemented various measures, including an increase in GST and excise duties, reduction in subsidies, adjustments in energy prices, and artificial curbs on the exchange rate.

Leave a Reply

Your email address will not be published.