ISLAMABAD: Pakistan's central bank raised its key rate by 100 basis points to 22% in an emergency meeting on Monday, it said in a statement.
The meeting came a day after the country passed a revised annual budget in hopes of securing a last gasp bailout from an International Monetary Fund programme that expires on June 30.
The bank said its monetary policy committee had noted "two important domestic developments since the last meeting that have slightly deteriorated inflation outlook and which could potentially increase pressure on the already stressed external account."
These developments include certain upward revisions in taxes, duties and petroleum levy rate in the recently approved FY24 budget, and the central bank withdrawing on June 23 its general guidance for commercial banks on prioritisation of imports.
Earlier this month Pakistan's central bank kept its key interest rate unchanged in line with market expectations, and signaled that it would pause its tightening cycle as record-high inflation may have peaked.
