KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has criticized the State Bank of Pakistan’s (SBP) decision to leave its key policy rate unchanged, saying the move will increase financial pressure on businesses and slow industrial and economic recovery.

In a statement issued after the SBP’s Monetary Policy Committee (MPC) meeting, Acting FPCCI President Saquib Fayyaz Magoon said the business community had expected a reduction in the benchmark interest rate to help lower financing costs and support trade and industry.

FPCCI says high interest rates are hurting businesses

Saquib Fayyaz Magoon described the decision to maintain the current policy rate as contractionary, arguing that elevated borrowing costs continue to restrict access to finance, discourage investment and hinder industrial growth.

He said manufacturers and exporters are already facing significant challenges due to high energy tariffs and financing costs, making it difficult for Pakistani businesses to remain competitive in international markets.

According to Magoon, reducing the policy rate to a single-digit level would help lower production costs, improve affordability of goods and services, and support broader economic activity.

Business leaders seek monetary policy review

FPCCI Vice President and Regional Chairman Sindh, Abdul Mohamin Khan, said stable core inflation should provide room for a more accommodative monetary policy.

He argued that maintaining a high interest rate increases the cost of capital for businesses, contributing to industrial closures and weakening the competitiveness of Pakistan’s export sector.

Abdul Mohamin Khan also warned that the unchanged policy rate could discourage new investment and delay economic recovery by increasing financial pressures on commercial and industrial enterprises.

FPCCI urges SBP to reconsider policy stance

The FPCCI reiterated its call for the State Bank of Pakistan to adopt a business-friendly monetary policy by reducing interest rates to single digits.

The business body said lower borrowing costs are essential to support industrial production, encourage investment, create employment opportunities and help achieve national export and economic growth targets during the current fiscal year.

Also Read :Supermicro Studies AI Data Center Upgrade at Data Vault Pakistan’s Karachi Facility