A key leader of the Pakistan Business Forum and former Vice President of FPCCI Captain Abdul Rashid Abro has called on the Governor of the State Bank of Pakistan to decrease interest rates to at least 5% during the upcoming monetary policy meeting on November 4.
He argued that such a reduction is vital for enhancing trade activities in the country, allowing exporters and industrialists to operate with greater confidence and less risk.
Abro pointed out that recent government data shows inflation at 6.9% in September, with forecasts suggesting a drop to 6.3% in October. In light of this, he stressed the urgent necessity to lower interest rates from the current 17.5% to 5% and to aim for single-digit rates by December.
He noted that economic and financial experts agree that, as inflation declines, interest rates should be adjusted downward to sustain industrial activity. Reducing interest rates would be crucial for supporting small and medium enterprises (SMEs) and large-scale manufacturing.
Read more
State Bank of Pakistan cuts key rate by bigger than expected 200 bps
Abro emphasized that addressing high inflation requires boosting industrial and commercial activities. However, with interest rates at 17.5%, promoting trade is challenging, hindering export growth. Conversely, reducing interest rates would stimulate new investments and help the government meet its inflation reduction goals, which align with commitments made in collaboration with the World Bank.
