Regulatory Alerts2025-01-27 | DMMD Circular No. 01Added · Updated
SBP Policy Rate and Overnight Repo and Reverse-Repo Facilities
The State Bank of Pakistan decreases the Policy Rate from 13.00% to 12.00%, effective January 28, 2025. The Overnight Reverse Repo rate is set at 13.00% and the Overnight Repo rate at 11.00%, establishing an interest rate corridor with a 200 basis point width. These adjustments apply to commercial banks and primary dealers, while other existing instructions remain unchanged.
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DMMD Circular No. 01
SBP’s Policy Rate and Overnight Repo / Reverse-Repo Facilities
January 27, 2025
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The Presidents/ Chief Executives, All Commercial Banks/ Primary Dealers
Dear Sirs/Madams,
SBP’s Policy Rate and Overnight Repo / Reverse-Repo Facilities
Please refer to DMMD Circular No. 08 dated December 16, 2024. Following changes are announced with reference to this circular:
SBP has decided to decrease ‘Policy Rate’ (Target Rate) from 13.00% to 12.00%.
SBP Overnight Reverse Repo (Ceiling) rate will be at 13.00%, i.e., 100 bps above the SBP Policy Rate.
The SBP Overnight Repo (Floor) rate will be at 11.00%, i.e., 100 bps below the SBP Policy Rate.
Accordingly, the Floor and Ceiling levels for the Interest Rate Corridor are 11.00% and 13.00% p.a., respectively (i.e., width of 200bps).
SBP will continue to ensure that the money market overnight rate remains close to the SBP Policy Rate (Target Rate).
Above changes are effective from January 28, 2025. Other instructions on the subject shall, however, remain unchanged.
Yours sincerely,
Dr. Mahmood ul Hasan Khan Director
Home — Circulars — DMMD Circular No. 01
SBP’s Policy Rate and Overnight Repo / Reverse-Repo Facilities
January 27, 2025
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