The Lahore Chamber of Commerce and Industry (LCCI) urged the State Bank of Pakistan (SBP) to bring down the discount rate to give a jumpstart to the economic activities. LCCI Acting President Tariq Misbah in a statement on Tuesday said SBP has to make a drastic cut at least by 250 to 300 basis points in discount rate in the next monitory policy to ensure cheap financing for industrial sector.
He said a cut of 50 to 100 basis points would not be doing any service to the dwindling economy. He said it is very unfortunate that we have failed to learn any lesson from the tighter monetary policy stance adopted by the State Bank of Pakistan in the yester years. He said economic managers should understand well that a 50 to 100 basis points cut will be too little. Misbah said it is now before all of us that high discount rate is no more sustainable. It has been causing a great harm to economy and would continue to do so unless and until a realist approach is adopted. He said despite higher inflation all the major economies have either curtailed or are in the process of reducing high interest rates to protect their economies.
He said the State Bank of Pakistan should understand that its continued tighter stance is inflicting a very heavy loss as the economy has already paid a very high price because of high interest rate. He urged the State Bank of Pakistan to announce at least 250 to 300 basis points cut in mark-up rates that would certainly give jumpstart to the economic activities in the country.
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