UBG chief calls for 500bps policy rate cut

LAHORE: The patron-in-chief of the United Business Group (UBG), S M Tanveer, has called for an immediate 500 basis point rate cut, pointing out that inflation has sharply declined to 6.9% from a peak of 38% in May 2023, strengthening the case for a further reduction in the current high rates.

“The central bank should bring policy rate down at 8% by January 2025,” Tanveer said adding, “The ease of doing business has become the need of the hour because of the overall improvement in the economic indicators.”

“A comparison of Pakistan’s macroeconomic indicators between June 2023 and September 2024 suggests significant economic improvements, leading to the approval of IMF package from its executive board,” the top UBG official said. According to Tanveer, the statistics demonstrate notable economic growth and stability, reflecting the efforts of Prime Minister Shehbaz Sharif’s government and Special Investment Facilitation Council (SIFC).

However, in the same breath, he cautioned that more efforts were required to operationalise the closed business activities through a single-digit interest rate and energy tariff. “Both the economic indicators and the IMF package are enough to raise a demand that the government should ensure a business-friendly environment and let the business and exports grow to promote investment and employment in the country,” the business leader said.