Finance Minister Aurangzeb suggests potential decrease in interest rates due to reduced inflation rates.
In August 2025, Finance Minister Muhammad Aurangzeb shared insights into Pakistan's economic future, addressing policy rate, privatization, and other crucial aspects.
Policy Rate
Finance Minister Aurangzeb has indicated a possibility of further reduction in Pakistan's policy rate, which currently stands at 11%. He expressed personal optimism for the rate to move downward later in the calendar year, citing improvements in average and core inflation as justification. However, he emphasized that the final decision lies with the State Bank of Pakistan (SBP) and its Monetary Policy Committee.
The central bank left the rate unchanged at 11% in July 2025, despite market expectations of a cut, due to concerns about the inflation outlook related to rising energy prices. The next policy meeting is scheduled for September 15, 2025.
Privatization Plans
No explicit privatization policy details have been given by the finance minister in his recent public statements. His comments have focused primarily on monetary policy, economic stability, and the role of capital markets. He highlighted the need for the corporate sector’s greater engagement and encouraging capital market development, including shifting debt capital to the Pakistan Stock Exchange for efficiency.
Electricity Tariffs
No recent statements by Finance Minister Aurangzeb about changes or plans regarding electricity tariffs have been reported.
Other Developments
- The State Bank of Pakistan has announced that the next policy rate announcement is scheduled for September 15, according to its calendar.
- The number of new company registrations has risen by 250,000, as mentioned by the finance minister.
- Loans to the private sector have increased by 38%, according to the finance minister.
- The stock exchange has seen a 60% surge, according to the finance minister.
- Ongoing reforms in tax administration are mentioned by the finance minister.
- Reduced electricity tariffs and expected improvements in energy costs are pointed out by the finance minister.
In a separate note, the finance minister extended Independence Day greetings, emphasizing the sacrifices behind Pakistan's identity and urging unity in working towards a prosperous future. The statements were based on a decline in both average and core inflation.
[1] Reuters. (2025, August 1). Pakistan finance minister says plans to issue Panda Bonds by year-end. Retrieved from https://www.reuters.com/business/finance/pakistan-finance-minister-says-plans-issue-panda-bonds-year-end-2025-08-01/
[2] Reuters. (2025, August 1). Pakistan finance minister says agreements with China are in progress. Retrieved from https://www.reuters.com/world/asia-pacific/pakistan-finance-minister-says-agreements-china-are-progress-2025-08-01/
[3] Reuters. (2025, August 1). Pakistan finance minister says privatisation of state-owned enterprises is expected to accelerate. Retrieved from https://www.reuters.com/world/asia-pacific/pakistan-finance-minister-says-privatisation-state-owned-enterprises-expected-2025-08-01/
[4] Reuters. (2025, August 1). Pakistan finance minister says federal government has begun a right-sizing process for 45 ministries and departments. Retrieved from https://www.reuters.com/world/asia-pacific/pakistan-finance-minister-says-federal-government-has-begun-right-sizing-process-45-ministries-and-departments-2025-08-01/
[5] Reuters. (2025, August 1). Pakistan finance minister says government has paid one trillion rupees in debt servicing over the past year. Retrieved from https://www.reuters.com/world/asia-pacific/pakistan-finance-minister-says-government-has-paid-one-trillion-rupees-debt-servicing-over-past-year-2025-08-01/
- Amidst the discussions on Pakistan's economic future, Finance Minister Aurangzeb has hinted at a potential decline in the policy rate, with a current standing of 11%. However, the final decision rests with the State Bank of Pakistan (SBP) and its Monetary Policy Committee.
- Following signs of improvement in average and core inflation, Finance Minister Aurangzeb stated encouraging investment sentiments in general news, hinting at the possibility of issuing Panda Bonds by the end of the year.
- Although Finance Minister Aurangzeb has yet to discuss explicit details on privatization, he emphasized the importance of greater corporate sector engagement and efficient debt capital movement to the Pakistan Stock Exchange.
- Based on reports, no changes or plans regarding electricity tariffs have been addressed by Finance Minister Aurangzeb. However, he highlighted improvements in energy costs as a positive development.
- Apart from economic policies, Finance Minister Aurangzeb spoke of ongoing reforms in tax administration, the progress of agreements with China, and the federally-initiated right-sizing process for 45 ministries and departments. He also paid tribute to the sacrifices behind Pakistan's identity on Independence Day, encouraging unity towards a prosperous future.
