SBP to announce new monetary policy today

F.P. Report

ISLAMABAD: The State Bank of Pakistan (SBP) will announce its monetary policy for the next two months on Monday (today).

According to reports, the interest rate is likely to be increased by one percent in the upcoming monetary policy.

Pakistan has been undergoing severe economic crisis, and the devaluation of rupee against the US dollar has doubled miseries of the government.

The value of the US dollar against the Pakistan rupee hit all-time high at Rs150 after gaining Rs3 in the open market on Friday.

It is believed that the sudden devaluation of local currency against the US dollar and the greenback hitting an all-time high of Rs150 is interlinked with the government’s commitments to the IMF.

Meanwhile, economists from Intermarket Securities Ltd and Foundation Securities Pvt among others are expecting a seventh straight hike in interest rates.

“The IMF program was supposed to bring certainty. Unfortunately until now there is confusion,” Arif Habib, chief executive office at Arif Habib Corporation said in a televised program after meeting finance adviser Abdul Hafeez Shaikh as part of a business community delegation in Karachi on May 16. “We have asked the finance adviser to tell us what is going to happen. People have not been able to anticipate where the rupee and interest rates will stand.”

Pakistan’s benchmark stock index has erased half its market value over the past two years as the deterioration in the economy prompted rating agencies to downgrade the nation. The currency has plunged more than 20% in the past year, the worst performer in a basket of 13 currencies in Asia compiled by Bloomberg.