Monetary Policy Committee: SBP issues advance calendar for meetings in July-December

The State Bank of Pakistan (SBP) has issued the advance calendar of Monetary Policy Committee (MPC) meetings for the period between July and December 2023.

The central bank is due to hold four meetings during the six-month period, according to the schedule. The first meeting will be held on July 31 (Monday), 2023 while the second one will be held on September 14 (Thursday), 2023.

The third meeting is scheduled to be held on October 30 (Monday), 2023 while the fourth is expected to take place on December 12 (Tuesday), 2023.

In the first half of 2023, the MPC held 5 meetings out of which the last one was an unplanned emergency huddle on June 26. This was held as Pakistan scrambled to meet conditions of the International Monetary Fund (IMF) to revive its programme.

In its announcement, the SBP raised the key policy rate by 100 basis points (bps) to 22%, a development that came two weeks after it held a regular huddle to keep the interest rate on hold.

In a press release, the central bank said that after its meeting on June 12, two important domestic developments have taken place “that have slightly deteriorated inflation outlook and which could potentially increase pressure on the already stressed external account”.

Pakistan’s new Stand-By Arrangement with the IMF also requires it to “keep an appropriately tight monetary policy aimed at disinflation”, which experts say could mean interest rates are likely to stay high in the near term.

What does the MPC do?

The MPC is responsible and fully empowered to decide the monetary policy stance.

Section 9E of the SBP Act 1956 lays out the powers and functions of the Monetary Policy Committee that have been mainly identified to formulate monetary policy, including, as appropriate, decisions relating to intermediate monetary objectives, key interest rates and the supply of reserves in Pakistan and may make regulations for their implementation.

Moreover, the MPC also approves and issues the monetary policy statement and other monetary policy measures. It also performs any other functions conferred on it by law and carries out any ancillary activities incidental to the exercise of its functions under this Act.