Monetary Policy Committee to meet on January 24, says SBP

The Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) will meet on Monday, January 24, 2022, at the SBP headquarters in Karachi.

In a short statement on Friday, the central bank said that SBP Governor Dr Reza Baqir will address a press conference on the same day after the MPC meeting.

In its last meeting in December, the MPC raised the policy rate by 100 basis points (bps), taking it to 9.75%.

The SBP, in its bid to tackle the current account deficit pressure and spike in inflation rate, has raised the interest rate by 275 bps since September last year.

However, many believe the central bank to hold off on a hike this time around.

“We expect the SBP to keep policy rate unchanged at 9.75% in the upcoming monetary policy statement,” said Arif Habib Limited (AHL) in a note. “To recall, the MPC convened its last meeting in December 21 and reiterated its stance to ensure the longevity of growth and countering inflation while gradually targeting mildly positive interest rates over time.”

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As per the survey poll conducted by AHL regarding market expectations in the upcoming monetary policy, 71% of the total respondents, which include representatives from financial services and manufacturing, are of the view that there will be no change in the policy rate for upcoming MPS.

Meanwhile, 29% of respondents expect a rate hike.

Another poll conducted by Topline Securities also conveyed that a majority expects status quo in the upcoming monetary policy announcement.