KARACHI: The State Bank of Pakistan (SBP) has decided to keep the policy rate unchanged at 15 per cent, according to a press release issued on Monday.
Providing the reasons for the Monetary Policy Committee’s (MPC) decision, the statement said:“With recent inflation developments in line with expectations, domestic demand beginning to moderate and the external position showing some improvement due to a lower trade deficit and resumption of the IMF (International Monetary Fund) programme, the MPC felt that it was prudent to take a pause at this stage.”
It said this pause allowed the MPC to assess the impact of tightening by 800 basis points since September and the fiscal consolidation planned for financial year 2023.
The SBP added that the move was also in line with recent actions by other central banks, who it said have been “holding rates in recent meetings as global growth and commodity prices have slowed”.
“To contain external pressures and support the rupee going forward, it is important to contain the current account deficit by delivering the budgeted fiscal consolidation, lowering energy imports through energy conservation measures, and keeping the IMF programme on track,” the SBP explained.
