The new State Bank governor Dr Reza Baqir has rightly argued that recent interest rates hikes are enough to tame inflation. Holding its main policy rate at 13.25% on Monday, the central bank has taken a pause from a series of recent hikes that it said had been enough to ensure the country's high inflation would gradually reduce over the coming years.

Sanity seems to have ultimately prevailed. Small and Medium Enterprises (SMEs) are among those sectors hit hard by rising interest rates. Is there any business possible if the lending rates are as high as 16%. Containing inflation is any central bank's central function but interest rates must not stifle activities of trade and industry.



Copyright Business Recorder, 2019