KARACHI: The State Bank of Pakistan (SBP) on Monday decided, for the fifth time, to keep the policy rate unchanged at 22 percent.
Addressing a press conference, SBP Governor Jameel Ahmad informed that a meeting of the Monetary Policy Committee (MPC) was held earlier.
1/3 The Monetary Policy Committee (MPC) decided to maintain the policy rate at 22 percent in its meeting held today.https://t.co/MutCaBVSV3#SBPMonetaryPolicy pic.twitter.com/0ZFWnGJ1Kw
— SBP (@StateBank_Pak) January 29, 2024
The MPC decided to keep the policy rate unhanged in view of the “improved economic situation.”
The SBP governor said the inflation rate would come down from 29pc during last month.
Foreign exchange reserves
Mr Ahmad said that Pakistan’s external account had “improved”, which is visible from foreign exchange reserves.
The SBP governor said that foreign reserves had surged $8.3 bln during the past six months.
“The foreign exchange reserves have increased despite payment foreign debt amounting to $6.2 bln and interest payments.”
#LiveNow: Press Conference on Monetary Policy Decision.https://t.co/0EWaWrf4JB
— SBP (@StateBank_Pak) January 29, 2024
The SBP’s forward book, which was at $4.5bn in July, had improved to $3.5 bln, he said.
Furthermore, he said the current account deficit had shrunk from 4.7pc to 0.7pc in the first six months of 2023-24. It is standing at $800 mln and the trend is continued in January as well,” the SBP governor added.
About inflation, the SBP governor said the MPC reviewed inflation-related developments.
In May 2023, inflation peaked at 38pc but a declining trend has been noted now.
“Although it still remains elevated, inflation will start declining faster from March,” Ahmad added.
The SBP governor said the MPC committee also closely reviewed inflated gas and electricity prices that impacted the continued inflationary pressure.
“Keeping this in view, the committee has revised the average inflation assessment for the current fiscal year to 23-25pc,” he stated.
