Skip to content
Search

Latest Stories

Pakistan central bank slashes interest rate to 17.5 per cent as inflation eases

Pakistan’s annual consumer price inflation rate slowed to 9.6 per cent in August from a multi-decade high of nearly 40 per cent in May 2023.

Pakistan central bank slashes interest rate to 17.5 per cent as inflation eases
Pakistan’s annual consumer price inflation rate slowed to 9.6 per cent in August from a multi-decade high of nearly 40 per cent in May 2023

PAKISTAN’S central bank cut its key policy rate by a bigger than expected 200 basis points to 17.5 per cent last Thursday (12), the third straight reduction since June as the country looks to spur growth as inflation eases.

“The pace of this disinflation has exceeded the committee’s earlier expectations,” the State Bank of Pakistan said. In a monetary policy statement, it attributed this to a delay in the implementation of planned increases in energy prices and falling global oil and food prices.


Last Thursday’s move follows cuts of 150 basis points (bps) in June and 100 bps in July that have taken the rate down from an all-time high of 22 per cent – set in June 2023 and left unchanged for a year.

Pakistan’s annual consumer price inflation rate slowed to 9.6 per cent in August from a multi-decade high of nearly 40 per cent in May 2023.

“The MPC assessed the real interest rate to still be adequately positive to bring inflation down to the medium-term target of five per cent – seven per cent and help ensure macroeconomic stability,” the bank said. “This would be essential to achieve sustainable economic growth over the medium term,” it said.

The bank said there was a possibility that average inflation for the fiscal year ending 2025 would fall below the previous forecast of 11.5 per cent to 13.5 per cent.

Economic indicators have stabilised since last summer when the country came close to a default before a last-gasp bailout from the International Monetary Fund (IMF). However, concerns have risen once again, with the global lender’s board yet to approve a staff level agreement struck in June for a new, $7 billion (£5.31bn), three-year programme that includes the requirement that Pakistan boost its external financing.

The central bank said its forecasts were partially contingent on “timely” foreign inflows as well as continued fiscal prudence by the government.

The government initially said it expected the board approval in August, and later said it was likely in September.

However, Pakistan central bank governor Jameel Ahmad told analysts in a briefing following last Thursday’s rate cut that external financing requirements had been met, and that he still expected the IMF board’s programme approval in September.

He added that he expected Pakistan’s foreign exchange reserves to increase above $12bn (£9.11bn) by March, up from $9.5bn (£7.21bn) currently, as inflows would increase after the IMF approved Pakistan’s programme.

More For You

Apple India Reroutes 97% of iPhones to US Amid Tariff Push

Apple iPhones are seen inside India's first Apple retail store in Mumbai, India, April 17, 2023.

REUTERS

Foxconn sends 97 per cent of India iPhone exports to US amid tariff push

NEARLY all iPhones exported by Foxconn from India between March and May were shipped to the United States, according to customs data reviewed by Reuters.

The data showed that 97 per cent of Foxconn’s iPhone exports during this period went to the US, significantly higher than the 2024 average of 50.3 per cent.

Keep ReadingShow less
Weaker labour market data sparks debate on rate cuts

The Bank of England is weighing inflation signals ahead of rate call

Weaker labour market data sparks debate on rate cuts

PAY growth in Britain slowed sharply and unemployment rose to its highest level in nearly four years in the three months to April, official figures showed on Tuesday (10), potentially reducing the Bank of England’s (BoE) caution over further interest rate cuts.

Wage growth excluding bonuses slowed to 5.2 per cent, the weakest pace since the three months to September, and fell more than expected from 5.5 per cent in January to March this year.

Keep ReadingShow less
London Tech Week: Indian firms show investment intent

Keir Starmer at London Tech Week in London on Monday (9)

London Tech Week: Indian firms show investment intent

MORE THAN 350 technology companies from India joined London Tech Week, which began on Monday – making it the largest-ever delegation from the country to attend the event.

London mayor Sadiq Khan’s office, City Hall, described the rise in Indian participation as a reflection of deepening ties between India and London’s tech sectors, following the recent signing of the India– UK Free Trade Agreement (FTA).

Keep ReadingShow less
London Tech Week

The discussion around inclusivity and parenthood is likely to remain in the spotlight.

Getty Images

London Tech Week: Woman entrepreneur says she was humiliated after being denied entry for bringing baby

A female entrepreneur has said she felt “absolutely humiliated” after being denied entry to London Tech Week because she was accompanied by her 18-month-old daughter.

Davina Schonle, founder and chief executive of AI start-up Humanvantage AI, had travelled from her home to attend the event at Olympia on Monday, 10 June. She said she had made a three-hour journey to London with her daughter, Isabella, only to be turned away on arrival because children were not allowed into the venue.

Keep ReadingShow less
Smartless Mobile launched by podcast trio

The move marks the first commercial spin-off from the Smartless podcast

Getty Images

Smartless podcast trio launches Smartless Mobile as low-cost phone service

The hosts of the popular Smartless podcast, actors Will Arnett, Jason Bateman and Sean Hayes, have launched a new mobile phone service in the United States. Called Smartless Mobile, the service offers a budget-friendly alternative to traditional phone plans and is aimed at users who spend most of their time connected to WiFi.

The move marks the first commercial spin-off from the Smartless podcast, which is known for its celebrity interviews and humorous tone. The new venture was announced in early June 2025 and has already begun accepting sign-ups across the US mainland and Puerto Rico.

Keep ReadingShow less