the Monetary Policy Committee (MPC) decided to raise the policy rate by 100 basis points to 16 percent.
“This decision reflects the MPC’s view that inflationary pressures have proven to be 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.” MPC said.
The central bank MPC noted several key developments since the last MPC in October..
The MPC noted that headline inflation rose by almost 3.5 percentage points in October to 26.6% percent (y/y).
SBP raises key interest rate by 100bps, takes it to 16%
- MPC says the decision reflects the view that inflationary pressures have proven to be stronger and more persistent than expected
- The majority of market participants had anticipated the central bank to maintain the key policy rate
