AVN 46.89 Increased By ▲ 0.24 (0.51%)
BAFL 28.80 Increased By ▲ 0.30 (1.05%)
BOP 3.75 Increased By ▲ 0.04 (1.08%)
CNERGY 3.16 Increased By ▲ 0.03 (0.96%)
DFML 10.95 Increased By ▲ 0.26 (2.43%)
DGKC 53.15 Decreased By ▼ -0.54 (-1.01%)
EPCL 42.94 Increased By ▲ 0.39 (0.92%)
FCCL 12.11 Decreased By ▼ -0.02 (-0.16%)
FFL 6.00 Increased By ▲ 0.07 (1.18%)
FLYNG 5.91 Decreased By ▼ -0.08 (-1.34%)
GGL 9.99 Increased By ▲ 0.09 (0.91%)
HUBC 68.52 Decreased By ▼ -0.08 (-0.12%)
HUMNL 5.70 Increased By ▲ 0.05 (0.88%)
KAPCO 22.10 Increased By ▲ 0.20 (0.91%)
KEL 1.77 Decreased By ▼ -0.01 (-0.56%)
LOTCHEM 29.26 Increased By ▲ 0.86 (3.03%)
MLCF 28.51 Increased By ▲ 0.06 (0.21%)
NETSOL 73.50 Increased By ▲ 1.10 (1.52%)
OGDC 76.65 Increased By ▲ 1.15 (1.52%)
PAEL 9.26 Increased By ▲ 0.06 (0.65%)
PIBTL 4.24 No Change ▼ 0.00 (0%)
PPL 59.29 Increased By ▲ 1.28 (2.21%)
PRL 14.26 Increased By ▲ 0.18 (1.28%)
SILK 1.12 Increased By ▲ 0.01 (0.9%)
SNGP 42.61 Increased By ▲ 1.86 (4.56%)
TELE 6.64 Increased By ▲ 0.05 (0.76%)
TPLP 11.90 Increased By ▲ 0.20 (1.71%)
TRG 93.90 Increased By ▲ 0.10 (0.11%)
UNITY 12.97 Decreased By ▼ -0.06 (-0.46%)
WTL 1.17 Increased By ▲ 0.01 (0.86%)
BR100 4,148 Increased By 17.5 (0.42%)
BR30 14,201 Increased By 124 (0.88%)
KSE100 41,492 Increased By 138.7 (0.34%)
KSE30 14,716 Increased By 51.5 (0.35%)
Follow us

KARACHI: The State Bank of Pakistan (SBP) looks likely to raise its key interest rate by 200 basis points to 22% at its review on April 4, as it struggles to tame inflation, the median estimate in a Reuters poll showed.

Eighteen out of 20 economists and market watchers surveyed said the central bank would hike rates, with 12 of them predicting a 200 bps increase.

Further hike in policy rate on the cards as inflation runs deep in Pakistan

Two poll participants saw the benchmark raised by 100 bps, while four forecast a 150 bps hike. Two respondents expected rates to remain unchanged.

Worldwide growth in consumer prices has compounded high inflation in Pakistan caused by a weakening currency, energy tariff increases and elevated food prices due to Ramadan.

The latest consumer price-based inflation clocked in at 31.5% in February, the highest in nearly 50 years.

UAE, Saudi Arabia: Dar says IMF seeking $3bn ‘guarantees’

Food, beverage, and transportation prices have all surged more than 45% and the country remains in talks with the International Monetary Fund (IMF) to unlock its next tranche of around $1.1 billion.

On March 2, the SBP raised its key rate by 300 basis points to 20%, exceeding market expectations.

SBP raises key interest rate by 300bps, takes it to 20%

“The CPI is expected to be 34-36% due to hike in food prices in Ramadan. The weekly sensitive price index is also at an all time high of 47%,” said Saad Habib, head of equities at Al Habib Capital Markets, a brokerage firm in Karachi.

The SBP has raised rates by a total 10.25% since January 2022.

Shivaan Tandon, an economist at Capital Economics, expects inflation to rise further in coming months as a weaker currency, higher taxes and shortages of key goods continue to exert upward pressure on prices.

Feb CPI jumps 31.5pc, highest rate in nearly 50 years

“Policymakers will also be keen to impress the IMF, by displaying their commitment to towards containing inflation, to secure a much-needed funding to mitigate the risk of default,” he added.

Some economists, however, felt with the last hike delivered just about a month ago, the central bank may prefer to wait to see the impact of the rate hikes on the economy before tightening further.

Earlier in March, brokerage house Arif Habib Limited (AHL), in a report titled ‘Pakistan Economy: Rate hike is still likely’, said it expects the SBP to raise its policy rate by 100bps to 21% on April 4.

In its results, it found that 57.7% of the total respondents were of the view that the SBP will increase the policy rate, of which: 30.8% were expecting a rate hike of 100bps, while 26.9% were foreseeing a rate hike of 200 bps. Over 42% of the total respondents were of the view that policy rate will remain unchanged at 20%.

SBP says MPC to be announced through press release

Meanwhile, the central bank said it will issue the Monetary Policy Statement through a press release on April 4.

Comments

1000 characters
Jamil khan Mar 31, 2023 05:47pm
Imran khan good man
thumb_up Recommended (0) reply Reply
kamran.khaliq Mar 31, 2023 09:49pm
good for bank eps increase. keep it up
thumb_up Recommended (0) reply Reply

MPC meeting: SBP likely to raise key policy rate by 200 basis points

Oil jumps 2% on Saudi plan to deepen output cuts from July

Virtual pipeline LNG import terminal: Govt mulling granting tax exemptions

$5bn trade with Turkiye achievable in 3 years: PM

AEDB grants 6-month LoI extension to two wind IPPs

IK says will be tried in military court

Power supply to Balochistan and Sindh will improve: NTDC energises Guddu-Shikarpur transmission line

Roosevelt Hotel given to NYC govt for 3 years: govt

PIA starts direct Karachi-Skardu flights

Crackdown on tax defaulting vehicles to begin today

Saudi pledges big oil cuts in July as OPEC+ extends deal into 2024