FPCCI Criticizes Insufficient Policy Rate Cut by State Bank of Pakistan

Karachi, In response to the recent policy rate adjustment by the State Bank of Pakistan (SBP), Mr. Atif Ikram Sheikh, President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), has expressed dissatisfaction, stating that the reduction is insufficient given the significant drop in core inflation. The business community had anticipated a more substantial decrease to better support competitiveness in international markets.

According to Federation of Pakistan Chambers of Commerce and Industry, core inflation in Pakistan has declined to 11.8% as of May 2024, the lowest in over two years. Despite this, the SBP's minor rate cut has been deemed too little, too late by industry leaders. Sheikh emphasized the need for a rate reduction to 15% alongside a rationalization of electricity tariffs to reduce capital costs and enhance export competitiveness. Additionally, Mr. Sheikh criticized the government for lack of transparency and consultation with the business community regarding economic policy and the implications of the upcoming IMF program.