Policy rate increase by 300 basis points totally unacceptable: President KCCI.

KARACHI -- President Karachi Chamber of Commerce and Industry (KCCI) Mohammed Tariq Yousuf, while expressing deep concerns over continuous devaluation of rupee against dollar which reached a new all-time high of Rs285 by appreciating abruptly by Rs18.89, urged the State Bank of Pakistan (SBP) to play its role and devise effective strategy to bring dollar value down as devaluation of rupee was having a deep negative impact on the economy, businesses and the inflation.

President KCCI said that the State Bank's announcement to raise policy rate by 300 basis points is totally unacceptable which would discourage borrowings. 'Businesses are not even in a position to make 25 percent profit nowadays in the prevailing situation. Who is going to go for borrowing at such exorbitant rates? This step would discourage industrialization, nurture inflation and create more problems for the economy', he added in a statement issued. He said, 'Although the experts are attributing the rupee devaluation to monetary policy but the SBP, being the regulator, has to play a role to find out the causes of abnormal upsurge and bring it down at any cost as it was totally unacceptable at the current inflated level otherwise, rising dollar against rupee would keep on creating numerous problems for the economy which is sinking as it faces a lot of challenges due to widening current and fiscal deficits.'

Tariq Yousuf said that appreciating dollar against rupee along with high energy tariffs were raising the cost of doing business, making Pakistani goods uncompetitive in the export markets and unaffordable for common man at the local markets as the...