KARACHI: Pakistan’s central bank cut its key policy rate by 200 basis points to 13% on Monday, it said in a statement, for a fifth straight reduction since June as the country keeps up efforts to revive a sluggish economy with inflation easing.
Pakistan’s latest move makes this year’s cuts the most aggressive among emerging market central banks in the current easing cycle, barring outliers such as Argentina.
The South Asian country is navigating a challenging economic recovery path and has been buttressed by a $7 billion facility from the International Monetary Fund (IMF) in September.
All 12 analysts surveyed by Reuters expected a 200 bps cut, after inflation fell sharply, slowing to 4.9% in November, largely due to a high base a year earlier, coming in below the government’s forecast and significantly lower than a multi-decade high of around 40 percent in May last year.
Monday’s move follows cuts of 150 bps in June, 100 in July, 200 in September, and a record cut of 250 bps in November, that have taken the rate down from an all-time high of 22%, set in June 2023 and left unchanged for a year.
It takes the total cuts to 900 bps since June.
