On October 30, the SBP’s Monetary Policy Committee will meet

There will be an interest rate decision to be made by the Monetary Policy Committee (MPC) of the State Bank of Pakistan as it meets on Monday (October 30) to make decisions on interest rates.

In a statement released through X, the former name of Twitter, the central bank said: “The Monetary Policy Committee of the South African Reserve Bank will meet on Monday, October 30, 2023 in order to decide about the Monetary Policy. A press release will be issued by the SBP to announce the Monetary Policy Statement on the same day.”

As a result of lower fuel prices and a stronger rupee, according to a report in The News, numerous experts believe that the SBP will likely remain at its current interest rate of 22% for the foreseeable future as inflation is likely to ease further.

There have been cumulative increases in the policy rate of the central bank by a total of 1,500 basis points since October 2021 in order to curb spiraling inflation and support the external balance. As of July 2023, the interest rate has been held at the current level.

As expected, the benchmark rate will not be changed at the upcoming policy review meeting, scheduled for Monday, according to financial market participants and analysts surveyed by brokerage Topline Securities.

There is a 70 percent chance that the policy rate will remain at 22%, and yet 16% of participants expect the policy rate to drop between 25 and 100 basis points, and 11% of participants expect it to drop more than 100 basis points,” Topline Securities said in its survey last week.

The SBP is also expected to hold the policy rate at 22 percent at the upcoming meeting, which is consistent with our expectation in our previous prediction. However, many analysts anticipate the SBP will be done hiking rates and will remain on hold until at least March 2024, if not longer.

As a result of the MPC meeting of the SBP held on September 14th, there have been a number of new developments since the last meeting of the MPC. There is a good chance that the MPC will discuss these issues in its upcoming meeting.

Aside from this, there is also evidence to suggest that stabilisation measures are beginning to yield results. After peaking at 38% in May 2023 and moving downward, the inflation rate dropped to 31.4% in September 2023 after reaching a high of 38% in May 2023, and it is projected that the inflation rate will continue to decline in the coming months, while the external account has achieved considerable improvement and foreign exchange buffers are being constructed.