The Monetary Policy Committee (MPC) of the State Bank of Pakistan (SBP) will meet on Monday, March 18, 2024 to decide about the monetary policy, the central bank announced on Friday.
The SBP said it will issue the Monetary Policy Statement through a press release on the same day.
A brokerage house sees “strong possibility” that the SBP may cut the key policy rate by 100 basis points (bps).
Arif Habib Limited (AHL), in its report released earlier this week, said there is a “strong possibility that the SBP may contemplate kickstarting the interest rate reversal cycle by implementing a 100bps cut in the upcoming policy”.
The key policy rate already stands at a record high of 22%.
It may be noted that Pakistan’s headline inflation clocked in at 23.1% on a year-on-year basis in February, according to the Pakistan Bureau of Statistics (PBS), much lower than the reading in January when it stood at 28.3%.
However, in its article on Friday, BR Research said that the SBP “should move with extra caution and keep real rates positive on current inflation”, arguing that to keep a delicate balance, slow and gradual easing is the order of the day.
“Expect around 200 bps cut in April, and SBP must maintain the policy rate on Monday,” it added.
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