SBP cuts interest rate to 11% over ‘considerable uncertainty’ after coronavirus pandemic

The State Bank of Pakistan has announced yet another cut in the interest rate on Wednesday, this time it has been slashed by 1.5% to 11%.

The state bank remarks that there was “considerable uncertainty” over the impact of the coronavirus pandemic.

A press release issued by the central bank stated, the  move has aimed “to facilitate businesses and exporters who seek loans frequently from commercial banks to run their businesses”.

“The global economy has been hit hard by the coronavirus, with the pandemic causing several businesses, including restaurants, hotels, airlines and manufacturing businesses to record losses in billions,” it added.

SBP also stated that considering the Monetary Policy Committee (MPC) there has “considerable uncertainty about how the Coronavirus outbreak would impact the global economy and Pakistan”.

The state bank on Twitter mentioned, “Substantial new information on global and domestic developments has become available since the last MPC meeting”.

“The developments discussed during the meeting imply that the outlook for growth and inflation in Pakistan is likely to be revised down further.”

Earlier, the central bank had said various policy measures was introduced to protect the public given the current potential economic impact amid the COVID19 outbreak.

SBP added that it had created a dedicated page for the new measures.