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Monetary policy on 16th

The Newspaper's Staff Reporter Published
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Since inflation is still high, the financial sector does not expect any downward change in the policy rate. — APP/File
Since inflation is still high, the financial sector does not expect any downward change in the policy rate. — APP/File
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KARACHI: The State Bank of Pakistan (SBP) will announce monetary policy on July 16, which will be the first under the new governor.

A press release issued on Friday said SBP Governor Dr Reza Baqir will unveil the decision of the Monetary Policy Committee at a press conference.

Since inflation is still high, the financial sector does not expect any downward change in the policy rate, which has been on the rise for more than a year and currently stands at 12.25 per cent. The SBP believes the high interest rate is a must to get control over the rising inflationary pressure in the economy.

However, the banking sector is still cautious while investing in long-term government papers fearing the interest rate may go up further. Banks invested mostly in three-month treasury bills.

Published in Dawn, July 13th, 2019

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HisMaster'sVoice
Jul 13, 2019 11:12am
You double interest rates and expect industry and commece to flourish, and are shocked when it doesn't. Because the incumbents and their sponsors have never had to 'earn' money. It was just allocated or gifted. Real world is a tough balancing act.
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Vikas
Jul 13, 2019 12:13pm
“Downward” change in interest rates??? Does not expect?? Is this even a news item?? How can the rates be reduced in Pakistan? And if someone, anyone was “expecting” so, seriously this is the problem with Pakistan. No one seems to understand economics. In this economic climate someone (even one) person was expecting a rate cut shows the lack of basic economic knowledge in Pakistan.
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Shazad
Jul 13, 2019 10:55pm
Industries don't flourish during the stabilization phase. All this was expected even while the PML-N was in power. They ruined the external account by subsidizing imports using borrowed dollars. An adjustment had to be made, it would lead to stagflation and that is exactly what happened.
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