SBP to hold policy rate at 22%: Economists’ Estimates
MG News | March 18, 2024 at 09:52 AM GMT+05:00
March 18, 2024 (MLN): The State Bank of Pakistan (SBP) is expected to hold the policy rate unchanged at 22% for sixth consecutive meeting today as the country will likely seek to negotiate a new International Monetary Fund (IMF) program soon.
The IMF has consistently advised maintaining a tight monetary policy stance.
The median estimate of the 10 economists predicts that the SBP will keep rates steady at a record high as inflationary risks persist.
SBP will remain cautious and adopt a 'watch and see' approach until the inflation trend maintain its fall, said Topline Securities Limited.
However, one analyst expects a rate cut."We believe that a data-driven approach will be pivotal in shaping the SBP's decision-making process," said Arif Habib Limited, which expects the central bank to slash rates by 100bps.
It is worth noting that the Consumer Price Index (CPI) for February slowed to a 20-month low of 23.1% YoY.
To recall, in the last scheduled meeting of January 2024, SBP maintained the policy rate unchanged at 22% citing that the frequent and sizeable adjustments in administered energy prices have slowed down the pace of decline in inflation anticipated earlier, besides impeding a sustained decrease in inflation expectations.
| # | Economist | Rate Decision (bps) |
|---|---|---|
| 1 | AKD Securities | 0 |
| 2 | Arif Habib Limited | -100 |
| 3 | Insight Securities | 0 |
| 4 | Intermarket Securities | 0 |
| 5 | Ismail Iqbal Securities | 0 |
| 6 | MG Research | 0 |
| 7 | Sherman Securities | 0 |
| 8 | Spectrum Securities | 0 |
| 9 | Taurus Securities | 0 |
| 10 | Topline Securities | 0 |
| Median | 0 | |
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