The State Bank of Pakistan will announce a new monetary policy today.

The Governor of the state issue a policy statement the upcoming interest rate in view of the current financial and economic conditions in press conference.

The prominent decline in the inflation graph in the country and positive trends in financial indicators have made the question whether the policy rate will be reduced or the State Bank will maintain the interest rate as 11 percent.

According to statistics, the inflation rate in Pakistan has reached its lowest level in the last sixty years.

The inflation recorded in April was 3.0 percent. According to which, a decrease in profits has also been seen on the auction of national savings schemes and government T-bills. This show that interest rate can be reduced.

Finance Minister Muhammad Aurangzeb supported the reduction in interest rates. He also stated that high interest rates can effect business and cause businesses to slowdown.

Business men and industrialists also demanded reduction in interest rate to single digits. According to them, interest rates in Pakistan are unnecessarily high compared to other countries in the region.

According to recent survey, 56 percent of experts expect interest rate to be reduced by 50 or 100basis points, whilst 37% donot expect any change.

Pakistan’s current base interest rate is 11percent . Economists believed that the inflation will remain between 5to 7 percent during the current fiscal year. In July, this rate may further increase to between 3 and 3.5 percent.

State Bank’s conference will remain main focus of the press conference today.

The governor’s decision will determine the direction of the country’s economy for the next few months.