Interest rate cut Pakistan could be on the horizon by the end of the year, according to Finance Minister Muhammad Aurangzeb. Speaking at an event in Islamabad, he suggested that the central bank has room to lower the policy interest rate, which currently stands at 11%. This announcement has sparked optimism among businesses and consumers who have been hoping for reduced borrowing costs and financial relief.
The central bank has already reduced rates from 22% to 11% since June 2024 through several intervals, but the finance minister believes that trends in average and core inflation indicate further space for an interest rate cut Pakistan. The next policy rate announcement, scheduled for September 15, will be closely watched by markets and investors alike.
Finance Minister Aurangzeb on Interest Rate Cut Pakistan Plan
Aurangzeb highlighted that the government’s economic measures, including a record decrease in the fiscal deficit, a current account surplus, and higher foreign exchange reserves, have strengthened Pakistan’s economic fundamentals. These improvements create a favorable environment for an interest rate cut Pakistan without destabilizing inflation.
In addition, the finance minister noted that expanding the tax base and closing loopholes will provide additional fiscal space, which could complement monetary policy adjustments. International credit rating agencies like Fitch and S&P have upgraded Pakistan’s ratings this year, and Moody’s is expected to follow, further supporting the potential for an interest rate cut Pakistan.
Financial markets are anticipating the central bank’s decision, as an interest rate cut Pakistan could reduce borrowing costs, encourage investment, and stimulate economic growth. Businesses and consumers alike are closely monitoring the situation, hoping that policy changes will make financing more affordable.
In conclusion, the finance minister’s remarks clearly indicate that an interest rate cut Pakistan may be implemented by the year-end. This move could provide economic relief, support growth, and strengthen confidence in Pakistan’s monetary policy framework.
Published in SouthAsianDesk, August 13th,2025
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