SBP cuts interest rate by 75 basis points

Slashing down the interest rate, the State Bank of Pakistan on Tuesday announced bi-monthly monetary policy and set it at 12.50 per cent.

Previously, the policy rate was at 13.25 per cent. The State Bank of Pakistan’s (SBP) Monetary Policy Committee (MPC) announced the new interest rate.

The central bank cut the interest rate by 75 basis points. The lowering down of the interest rate was expected in line with the global economic slowdown due coronavirus pandemic.

SBP announced to give loans to hospitals on 3 per cent interest rate. “Inflation rate is expected to lower down in coming two months. Petroleum prices will also lower down due to cut in crude oil prices.”

Earlier on Sunday, the US Federal Reserve announced it would cut its target interest rate near zero. Some other countries are also thinking on the same lines.

In New Zealand, the central bank cut its official cash rate to a record low 0.25 per cent from 1 per cent.

On the other hand, it is expected that the Bank of England will slash interest rates to a record low in an effort to combat the impact on the economy of coronavirus.