Pakistan Central Bank lifts key policy rate by 100 basis points to 16%

Pakistan’s central bank on Friday raised its key policy rate by 100 basis points to 16% in an unexpected move to control the spiralling inflation and to ensure that growth remains sustainable.

With this increase, the central bank has raised its key rate by 625 basis points cumulatively in 2022. The rates were kept unchanged at its last two meetings in October and September.

“This decision reflects the MPC’s view that inflationary pressures have proven to be stronger and more persistent than expected,” the central bank said in a statement after the monetary policy committee meeting.