Interest Rate Impact on Monetary Policy in Pakistan

ABSTRACT

This study aims to analyze the significant influence of interest rates on important economic indices, such as GDP, exchange rates, and inflation rates. This quantitative research, conducted between 2012 and 2022, makes use of a thorough analytical approach that includes descriptive, correlation, and regression analyses to look into the complex relationships between four important economic indicators: GDP, interest rates, inflation rates, and exchange rates. Data from this years period will be gathered and analyzed as part of the research approach. Significant variances in these variables are revealed by descriptive statistics, which also shed light on their main trends and ranges. Strong positive correlations between inflation and interest rates and between inflation and exchange rates are revealed by this investigation. Regression research explores the causal relationships and shows that interest rates have a considerable influence on both inflation and exchange rates. These results provide an advanced analysis of the economic dynamics in this period, offering insightful information to policymakers and analysts pondering the complex interactions between these crucial elements.

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