Businesses Strongly Denounce SBP Rate Hike

In practice, the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has criticized the State Bank of Pakistan's (SBP) latest decision to raise the policy rate by 0.5 percentage points to 12 percent, urging the administration and central bank to bring.

Key points

• FPCCI President Atif Ikram Sheikh remarked the rise would raise borrowing costs for businesses already facing high operating expenses, rising utility tariffs, and liquidity constraints.
• He cautioned that tighter monetary policy could weaken industrial expansion, discourage investment, and reduce the international competitiveness of Pakistani exports.
• Sheikh additionally cautioned that high interest rates rose debt-servicing costs for both the administration and private borrowers, potentially adding to fiscal pressure and limiting economic expansion.
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• He remarked inflation was being driven largely by supply-side constraints, rising energy costs, and fiscal matters rather than excess demand.

He cautioned that tighter monetary policy could weaken industrial expansion, discourage investment, and reduce the international competitiveness of Pakistani exports. SBP Hikes Interest Rate First Time Since June 2026.

Sheikh argued that high interest rates had created borrowing increasingly challenging for manufacturers and commercial enterprises at a time when affordable credit was needed to backing production, maintain operations, and create jobs.

In his view, higher interest rates would place extra pressure on productive industries without adequately addressing the underlying causes of inflation.

In practice, the FPCCI president called on the administration and the central bank to recalibrate monetary policy and reduce the policy rate to single digits.

He remarked lower borrowing costs were essential for small and medium-sized enterprises, traders, and large-scale manufacturers to invest in technology, expand value-added production, and compete with regional businesses.

FPCCI pressed the central bank, federal administration, and economic policymakers to adopt a more growth-oriented monetary approach, align interest rates with regional benchmarks, and consult the business community before introducing policies that directly affect economic activity. Stay Connected with ProPakistani.

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For now, businesses Strongly Denounce SBP Rate Hike remains the part of the story worth watching, and further updates are likely as more details are confirmed.