KARACHI: All 13 analysts polled by Reuters expect the State Bank of Pakistan (SBP) to leave its key policy unchanged at 12 percent for the subsequent two months when it meets on Friday to announce its monetary policy.
Average inflation for the first nine months of 2011/12 was 10.79 percent and is expected to be within the government's full-year target of 12 percent, but it remains elevated and is a major concern.
"The central bank has limited room for monetary stimulus given the growing challenges to macroeconomic stability in shape of stubborn inflation, increasing external account pressures and a large fiscal deficit," said Asif Qureshi, director at Optimus Capital Management Ltd.
Pakistan's current account deficit widened to $2.95 billion in the first eight months of the 2011/12 fiscal year, compared with $194 million over the same period in the previous year.
The current account deficit in February was $260 million, compared with a deficit of $98 million in February 2011. The deficit stood at $364 million in January 2012.
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