According to a press release published on Thursday, the State Bank of Pakistan (SBP) chose to maintain the key policy rate at 22%.
Following a meeting of the bank’s Monetary Policy Committee (MPC), the announcement was made.
“[The] MPC noted that, despite recent increases in global oil prices, inflation is still expected to trend lower, particularly in the second half of this year,” it stated.
The MPC also concluded that the restrictive monetary policy stance, improving agricultural outlook, and recent administrative and regulatory reforms will all contribute to meeting the medium-term inflation objective.
The committee also emphasised the importance of maintaining a careful fiscal approach in order to keep aggregate demand underline.
The MPC stated that it will continue to evaluate threats to the inflation outlook and, if necessary, take appropriate action to achieve price stability.
At the same time, the MPC underlined the importance of maintaining a conservative fiscal approach in order to keep aggregate demand under check.
This is required to meet the medium-term target of 5-7% by end-FY25 and to keep inflation down on a sustainable basis.
