The State Bank of Pakistan (SBP) halted its several rounds of monetary easing, which may have jeopardized currency stability or widened the trade imbalance, when inflation began to decline.
The nation’s central bank unexpectedly maintained interest rates at 12% on Monday, prompting economists to argue that the government should instead concentrate on enacting economic reforms because interest rate decreases are not the magic bullet for growth.
Vaqar Ahmed, an economist and Oxford Policy Management team lead, stated that “the rate cuts alone may not meet growth targets.” “They need to be complemented by prudent fiscal measures, such as tax reforms, energy sector viability and privatisation of state-owned enterprises, to encourage private sector investment and prevent crowding out.”
