In a statement released by State Bank, it was said that the Monetary Policy Committee (MPC) in today’s meeting has decided to maintain the policy rate at 15% as expected due to inflation, moderation in demand and improvement in external position.
According to the statement, the policy rate has been increased by a total of 800 basis points since last September to cool the overheating economy and control the current account deficit.
According to the monetary policy statement, the current situation of inflation is in line with the expectations, likewise due to the moderation in domestic demand and the beginning of some improvement in the external position, the MPC was of the opinion that it would be wise to take a pause at this stage.
It was further informed that since the last session, headline inflation rose to 24.9% in July, along with core inflation, which was expected to rise as the necessary removal of energy subsidies, food prices There was an increase and a decrease in the exchange rate.
As the trade balance fell sharply, the rupee reversed its depreciating trend during August, and its value improved by nearly 10 percent. The third important thing that has happened is that the Board will meet on August 29 on the ongoing review under the International Monetary Fund (IMF) program, and we expect to receive an installment of $1.2 billion, the statement said.
Similarly, Pakistan has successfully received an additional $4 billion from friendly countries, which will further increase its foreign exchange reserves. It may be noted that on July 7, State Bank increased the interest rate by another 125 basis points from 13.75 to 15 percent.
Acting Governor State Bank Dr. Murtaza Syed said in the press conference that inflation has become very high, food and drink items have become very expensive, then the government has just taken a difficult decision which was the right decision to end the subsidy of electricity and petrol.
He said that because of this, there is a lot of pressure on the common man, the State Bank and the Monetary Policy Committee are putting a lot of emphasis on controlling inflation because it is creating a lot of problems for our common man. . He said that controlling inflation is now our most important objective so that our common man can get relief. The Acting Governor had said that the Monetary Policy Committee of the State Bank has decided to increase the interest rate by 1.25% to 15%.