State Bank of Pakistan blames government for rate hike

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Excessive borrowing by Islamabad to fund its burgeoning deficit forced the State Bank of Pakistan to hike rates for a third successive monetary policy meeting, the central bank said Monday.

The central bank increased the benchmark rate by 50 basis points to 14%, following similar rate hikes in July and September to mop up excess liquidity in the market. It blamed the rate hike on the government's "relentless" borrowing from its reserves, which it said was causing inflation to rise persistently.

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