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SBP retains rate of interest unchanged at 22%

by Pakistan Latest News Update

The Financial Coverage Committee of the State Financial institution of Pakistan (SBP) has stored the important thing coverage price unchanged at 22%.

“At its meeting today, the Monetary Policy Committee (MPC) decided to maintain the policy rate at 22 percent,” the SBP mentioned in a press release.
“This choice takes under consideration the most recent inflation outturn reflecting the persevering with declining pattern in inflation from its peak of 38 % in Might to 27.four % in August 2023.
“Although world oil costs have risen not too long ago and are being handed on to customers by adjustment in administered power costs, inflation is projected to stay on the downward trajectory, particularly from the second half of this yr.
“As such, real interest rates continue to remain in positive territory on a forward-looking basis. Moreover, the expected ease in supply constraints owing to better agriculture output and the recent administrative measures against speculative activity in the FX and commodity markets would also support the inflation outlook.”
The MPC mentioned it famous 4 key developments since its July assembly.
“First, agriculture outlook has improved, primarily based on the most recent knowledge on cotton arrivals, higher enter circumstances, and satellite tv for pc knowledge indicating wholesome vegetation of different crops.
“Second, world oil costs have been rising and at the moment are hovering over $90/barrel stage.
“Third, as anticipated, the present account posted a deficit in July after remaining in surplus for the final 4 months, partly reflecting the influence of the latest ease in import restrictions.
“Finally, recent administrative and regulatory measures aimed at improving availability of essential food commodities and curbing illegal activities in the foreign exchange market have begun to yield results. This has helped in narrowing the gap between the interbank and open market exchange rates.”
The assertion mentioned the MPC will proceed to watch the dangers to the inflation outlook and, if required, it can take applicable motion to attain the target of worth stability.

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