March 6, 2020 (MLN): A top Pakistani Industrialist, Chief Executive of Arif Habib Corporation Limited, while giving his interview to Bloomberg has urged the State Bank of Pakistan (SBP) to cut interest rates to shoot investment in the economy.
The slowdown in current inflation numbers has provided an ample room to drop the interest rates by 50 bps this month from the current level of 13.25%, he said.
In the interview, he citedheadline inflation that eased by more than two percentage points in February, and expectations for price-growth to slow further in March.
“The relief in inflation supports the case for decreasing interest rates, and Cheaper loans will increase consumer demand,” he said.
Arif Habib emphasized that the growth could only be improved if SBP lowers borrowing cost, Bloomberg reported.
As per Bloomberg, Arif Habib said that the measures to meet the conditions of the International Monetary Fund (IMF) has weighed on businesses and consumer demand. In addition, owing to devaluation, the projects’ costs have increased.
Thus, the rate cut is essential to attract new investments which currently are in the pipeline, he added.