SBP governor to unveil new monetary policy today: spokesperson

KARACHI: The governor of the State Bank of Pakistan (SBP), Dr Reza Baqir, has chaired a session of Monetary Policy Committee (MPC) underway in Karachi, said the spokesperson Tuesday.

The spokesperson said the SBP governor will announce new monetary policy after the committee reviews the economic statistics of the country.

Economic experts said the average inflation stands at 11.5 per cent and the economic growth rate is expected to remain 3.0 to 3.5 per cent in the current fiscal year. They said variations in crude oil prices in the global market could leave impacts. The inflation rate is likely to be recorded up to 12 per cent in the end of the current financial year, whereas, the interest rate will remain 13.25 for the next two months, said experts.

Read: Reza Baqir emphasises optimum performance to uplift economy

In December last year, the governor of the State Bank of Pakistan (SBP), Dr Reza Baqir, had hinted that more time will be required for making a reduction in the interest rate of the country.

Reza Baqir, while addressing an event of the central bank in Faisalabad, however, said that improvements are being witnessed in the stock market but it will take more time to reduce the interest rate.

He said that people have raised concerns over increasing US dollar rates. He added that the current interest rate is standing at 13.25 per cent which had been maintained at 17  to 18 per cent in past.

Read: SBP governor says steps being taken to promote banking sector

It is pertinent to mention here that the State Bank of Pakistan had announced the monetary policy for the next two months on September 16 – 2019 and kept the rate of interest unchanged at 13.25 percent.

“The Monetary Policy Committee (MPC) decided to leave the policy rate unchanged at 13.25 percent. The decision reflected the MPC’s view that inflation outcomes have been largely as expected and inflation projections for FY20 have remained unchanged since the last MPC meeting on 16th July 2019,” said a press release issued by State Bank of Pakistan.

The new monetary policy noted two key developments since the last MPC meeting. First, the interbank foreign exchange market has adjusted relatively well to the introduction of the market-based exchange rate system. The initial volatility and associated uncertainty in the exchange market had subsided added press release.