Karachi, July 23, 2024 – The State Bank of Pakistan (SBP) has unveiled the schedule for its Monetary Policy Committee (MPC) meetings until December 2024, setting the stage for key decisions that will shape the country’s economic landscape. The central bank is scheduled to convene four times during this period.
The first MPC meeting is slated for July 29, 2024, followed by another on September 12, 2024. The third meeting will be held on November 4, 2024, with the final meeting of the year scheduled for December 16, 2024.
This schedule follows a significant 150 basis point reduction in the key policy rate to 20.5% during the June 10 meeting. Market expectations are now focused on further monetary easing. Arif Habib Limited, a leading brokerage and investment banking firm, anticipates a 100 basis point cut, potentially bringing the rate down to 19.5%. The firm cites declining inflation and improving economic indicators as key factors supporting this forecast.
International ratings agency BMI also projects a rate cut at the upcoming MPC meeting. They foresee a gradual decline in the policy rate, predicting it will reach 16% by the end of 2024 and 14% by the end of 2025. This outlook is based on the anticipated stabilization of macroeconomic indicators and a concerted effort to support economic growth.
The MPC, as stipulated in Section 9E of the SBP Act 1956, is responsible for formulating monetary policy. This includes setting interest rates and managing the country’s reserve levels. The committee’s decisions are crucial for steering the economy, particularly in times of economic fluctuation.
The upcoming meetings will be closely watched by market participants, businesses, and policymakers. The decisions made by the MPC will have a direct impact on borrowing costs, investment activities, and overall economic sentiment. A further reduction in the policy rate could spur investment and consumer spending, providing a much-needed boost to economic growth.
The SBP’s proactive approach in outlining the schedule for MPC meetings underscores its commitment to transparency and effective communication. By providing a clear timeline, the central bank aims to manage market expectations and ensure stakeholders are well-informed about the policy direction.
The SBP announcement of the MPC meeting schedule until December 2024 highlights the central bank’s strategic approach to monetary policy. With market expectations leaning towards further rate cuts, the upcoming meetings will be pivotal in shaping the economic outlook. The SBP’s commitment to transparency and proactive policymaking is expected to foster stability and confidence in the financial system.