Independent Monetary Policy Committee held a meeting today to review the key macroeconomic variables during the last two months to decide the discount rate.
Later, a central bank statement announced the monetary policy for the next two months keeping the policy rate unchanged at 5.75 percent as announced in the previous monetary policy on July 30, 2016.
Earlier, some analysts were of the opinion that in view of the lower inflation there is room for another cut of 25 basis points in the key policy rate.
The central bank however opted to keep the policy rate unchanged due to the pressure on external account which is under pressure because of higher current account deficit and lower exports during the initial months of the current fiscal year.
Pakistan’s current account deficit sharply increased by 92 percent during July-August in ongoing fiscal year. Current balance posted a deficit of $1.316 billion in first two months of FY 2016-17 compared to $686 million in same period of the previous year.