UBG Calls for 500 Basis Points Cut in Policy Rate Amid Declining Inflation

Karachi: Declining inflation rates have prompted the United Business Group (UBG) to advocate for a substantial reduction in policy rates, a move they believe will stimulate economic growth. SM Tanveer, the patron-general of UBG, has urged the government to reduce the policy rate by 500 basis points following a notable decrease in the Consumer Price Index (CPI) inflation rate for November 2024.

According to United Business Group, the CPI inflation rate has fallen to 4.9 percent annually, a significant drop from the previous month’s rate of 7.2 percent. SM Tanveer attributes this decline to adjustments in the bank markup rate, which he believes will soon bring it back into single digits. This shift is expected to make credit more accessible and affordable for both businesses and consumers, potentially increasing investment and boosting economic activity.

Tanveer emphasized that the reduction in CPI reflects a major improvement in economic stability and highlights the effectiveness of recent policy measures. He credited the hard work of economic planners and the perseverance of the business community for this positive development. Tanveer also noted that lower inflation provides relief to citizens by reducing the cost of living and increasing purchasing power.

The United Business Group, along with its partner BMPP, expressed commitment to supporting policies that foster economic growth and stability. They aim to continue collaborating with government, industry partners, and international stakeholders to maintain and build upon these economic achievements.

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