At today’s Monetary Policy Committee (MPC) meeting, the State Bank of Pakistan (SBP) resolved to lower the policy rate by 200 basis points to 17.5 percent, which will take effect on September 13, 2024.
Over the previous two months, both headline and core inflation dropped significantly.
Because of the favorable movement in the price of food and oil globally as well as the delay in implementing anticipated increases in administered energy prices, the speed of this disinflation has somewhat exceeded the Committee’s previous forecasts. However, the Committee recognized that there was inherent uncertainty surrounding these developments, which called for a cautious approach to monetary policy.
