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SBP raises interest rate to 17%, highest in over two decades

With inflation spiking to the highest-ever levels, the Governor of the State Bank of Pakistan (SBP) Jameel Ahmad has announced to raise the interest rate to an all-time high level of 17%.

This is the highest rate since October 1997.

At a presser on Monday, the SBP governor explained that inflationary pressures were stronger and more persistent than expected.

“It is aimed at ensuring that elevated inflation does not become entrenched and that risks to financial stability are contained, thus paving the way for higher growth on a more sustainable basis.”

The central bank raised the benchmark interest rate by 100 basis points (bps) today taking the total increase to 1,000 bps since September 2021 to counter rising inflation.

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