Pakistan's central bank expected to not change the
current key policy rate
According to a survey report by a leading brokerage firm,
the State Bank of Pakistan (SBP) is anticipated to maintain the current key
policy rate at 22% during its upcoming monetary policy committee (MPC) meeting
on Monday, citing high inflation as a determining factor.
This decision is expected to be the fifth consecutive
instance of an unchanged policy rate. The survey reveals that 68% of
participants predict no change in the policy rate, while the remaining 32%
anticipate a rate cut, with varying expectations among those foreseeing a
reduction.
State
Bank of Pakistan keeps policy interest rate steady at 22%
Some analysts suggest a possible 50 basis points cut, influenced
by recent rate adjustments in Treasury bills. Despite prevailing expectations,
there is speculation that the central bank might implement a rate cut in March
2024 based on projections of reduced inflation.
The upcoming meeting is crucial as it precedes general
elections scheduled for February 8. Recent economic developments, including a
Current Account Surplus and released funds from an IMF bailout, add complexity
to the decision-making process. The IMF, while expecting a 2% growth in the
Pakistani economy for the current fiscal year, emphasizes the need for the SBP
to maintain a tight stance to address persistently high inflation.
Source: https://www.arabnews.pk/