KARACHI, Nov 1 Reuters Pakistan39;s central bank is expected to cut its key interest rate further at its policy meeting on Monday, with policymakers continuing their efforts to revive a fragile economy as inflation eases off recent record highs.

The central bank, the State Bank of Pakistan, has slashed the benchmark policy rate to 17.5 from an all timehigh of 22 in three consecutive policy meetings since June, having last reduced it by 200 basis points in September.

All 15 investors and analysts surveyed by Reuters expect the central bank to cut rates next week. Two expect a 150 bps cut, twelve predict a 200 bps reduction, and one forecasts a 250 bps cut.

Economic activity has stabilised since last summer when the country came close to a default before an eleventh hour bailout by the International Monetary Fund IMF.

The IMF, which in September gave a boost to Pakistan39;s struggling economy by approving a longawaited 7 billion facility, said that the South Asian nation had taken key steps to restore economic stability with consistent policy implementation under the 202324 standby arrangement.

While the economy has started to gradually recover, and inflation has moved sharply down from a multidecade high of nearly 40 in May 2023, analysts say further rate cuts are needed to bolster growth.

Mustafa Pasha, Chief Investment Officer at Lakson Investments, said rates must drop under 15 and hold below that for six months to have a material impact.

The IMF in its latest…