Dhaka, May 23 -- Pakistan's central bank raised the key policy rate on Monday by 150 basis points to 13.75 per cent, the second hike in less than two months, as the South Asian nation grapples with a sinking economy.

"This action, together with much needed fiscal consolidation, should help moderate demand to a more sustainable pace while keeping inflation expectations anchored and containing risks to external stability," the State Bank of Pakistan (SBP) said in a statement, reports Reuters.

The country is going through economic turmoil, including high inflation, reserves declining to as low as less than two months of imports and a fast-weakening currency.

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