Karachi June 10 2024: State Bank of Pakistan monetary policy committee decided to cut policy rate by 150 basis points from record high 22 percent due to drastic ease in inflation in today meeting.
The MPC noted that while the significant decline in inflation since February was broadly in line with expectations, the May outturn was better than anticipated earlier.
The MPC assessed that underlying inflationary pressures are also subsiding – as reflected by continued moderation in core inflation and ease in inflation expectations of both consumers and businesses – amidst tight monetary policy stance, supported by fiscal consolidation.
MPC viewed some upside risks to near-term inflation outlook from upcoming budgetary measures and energy price adjustments. Notwithstanding these risks and today’s decision, the cumulative impact of earlier monetary tightening is expected to keep inflationary pressures in check.
