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Pakistan Cuts Interest Rates To 42-Year Low

Pakistani currency
Pakistani currency

Pakistan's central bank has slashed its benchmark interest rate to a 42-year low, hoping to stimulate economic growth as inflation slows.

The State Bank of Pakistan said on May 23 that it had lowered the rate from 8 percent to 7 percent -- the lowest since 1973.

Inflation in the world's sixth-most populous nation has eased each month since the beginning of the year as transport and food prices fell, giving the central bank room to spur growth.

The International Monetary Fund this month scaled back Pakistan’s growth forecast for the year through June to 4.1 percent from 4.3 percent, slightly higher than last year’s 4 percent.

Meanwhile, Standard & Poor’s and Moody’s Investors Service have raised their outlooks on Pakistan’s credit rating to positive from stable since March, citing the country’s improving financial position and growth prospects.

Based on reporting by AFP and