Elixir Securities - Pakistan Economy - 100bps Hike Expected in MPS on Rising Inflation

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Elixir Securities

Sharoon Ahmad

EUR 4.24 For Business Accounts Only

Pakistan Economy - 100bps Hike Expected in MPS on Rising Inflation

We expect SBP to raise interest rates by 100bps to PR/DR of 9.5/10.0% in upcoming monetary policy due to rising inflation (General/NFNE inflation estimated at 7.4/8.8% YoY for Nov-18).
Money market yields indicate expectation of 100-150bps hike in interest rate as 12M T-bills secondary market yields / 12M KIBOR have increased by 126bps/148bps since the last monetary policy.
We anticipate recent slide in international oil prices to be offset by the recent/expected spurt of PKR depreciation, thus inflation is projected to remain in double digits for better part of 2019.
In this backdrop, we project cumulative interest rate hike of 200bps over the rest of FY19 (inclusive of 100bps in Nov-18).

23/11/2018 3 EN

Provider

Elixir Securities

Elixir Securities Pakistan is a Corporate Member of the Pakistan Stock Exchange & Pakistan Mercantile Exchange and is one of the leading securities brokerage & investment banking firms in Pakistan, established since 1994. Our principal business activities include all aspects of Pakistan’s Capital Markets covering Securities Brokerage (Equities, Fixed Income and Commodities), Corporate Finance & Capital Markets Advisory (M&A, ECM, DCM) and Investment Research (Economics & Securities). We are one of the most active & aggressive Broker-Dealers in Pakistan executing trades for most of the Top 20 Global Brokers with unmatched corporate access credentials and have successfully advised and closed on some landmark ECM transactions in the history of Pakistan including the largest deal in frontier Asia (USD 1.02 billion). Our Clients include foreign and domestic financial institutions (Banks, Asset Managers, Insurance Companies, Pension Funds) corporates, HNWI’s and retail investors. This is supported by a very strong and independent research capability, which is quoted regularly in both local and international media.

Elixir Securities Pakistan is the proud recipient of many awards & recognitions including AsiaMoney’s Brokers Poll 2017, FinanceAsia’s Pakistan Best Investment Bank and Best Broker 2017, The Asset’s Best Brokerage House in Pakistan 2016, Asiamoney’s “Best Domestic Equity House 2015 in Pakistan”, The Asset Triple A Country Awards 2015 - Pakistan “Deal of the Year” and “Deal of the Year-Highly Commended”, CFA Society of Pakistan Awards for Year 2015 “Best Research Analyst (1^st Rank), CFA Society of Pakistan Awards for Year 2014 “Best Research Analyst (1^st Rank)”, “Best Trader” 2nd Runner-up (3rd Rank), The Asset Triple A Country Awards 2014’s “Best Deal in Pakistan” and Capital Finance International’s nomination for “Best Equity Research in Pakistan 2010”.

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Sharoon Ahmad

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Pakistan Economy - 100bps Hike Expected in MPS on Rising Inflation

Open End Mutual Funds Industry - Ad Oculos

Pakistan Equity Market: Weekly Review - Index Closes Above 41k Mark on Foreign Buying

Elixir Grid - KSE100: Make or Break?

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