Karachi, Pakistan (BBN) - The State Bank of Pakistan (SBP), the country’s central bank, is set to unveil its monetary policy stance (MPS) on Saturday.
Meanwhile, the Islamabad Chamber of Commerce and Industry (ICCI) has called upon the SBP to make a cut of 150 basis points in key discount rate in forthcoming the MPS in order to create favourable conditions for private sector growth and acceleration of business and economic activities.
Muzzamil Hussain Sabri President, Muhammad Shakeel Munir senior vice President and Muhammad Ashfaq Hussain Chatha vice President Islamabad Chamber said cost of credit in Pakistan was quite high and was hampering the growth of private sector up to potential.
They said reducing the key policy rate to 8.0 per cent would provide cheap credit and help businesses to expand and grow fast leading to significant improvement in the national economic output.
More than 50 percent fall in global oil prices, lower import bill and other factors have created a good space for the government to make 150 basis points cut in key policy rate as the economy badly needed a low rate scenario to accelerate the pace of its growth, according to the business leaders.
Pakistan’s economy has been struggling since long to recover from its weak phase of growth and drastic cut in key policy rate would provide a favourable push to spur demand and trigger economic activities.
They also said tight monetary policy has mostly restricted the economic development of the country as it crowded out the private sector from credit, discouraged new investment and stalled the business and industrial growth.
BBN/SSR/AD-24Jan15-11:34 am (BST)