Pakistan Economy: SBP maintains Policy Rate at 5.75%
​SBP has kept Policy Rate unchanged at 5.75% (DR: 6.25%) for the next two months, alluding to controllable inflation level during 1HFY17 (3.9%YoY), supported by smooth domestic supply of perishable commodities, stable exchange rate, and GoP’s absorption of higher international oil prices.
With CPI clocking in lower than expected during 1HFY17, our revised FY17 estimate of 4.3% (vs. previous 4.5%), is suggesting probable delays in the interest rate liftoff cycle. We now expect commencement of a gradual monetary tightening cycle from 2HCY17.
CPI/NFNE for Jan’17 is projected to be 3.71%/5.00%YoY, implying a sequential rise of 23/71bps MoM. Food inflation is expected to clock in at 2.73%YoY (down 42bps MoM), backed by improved domestic supplies.
Intermarket Securities Limited (IMS) is a full service corporate brokerage firm based in Karachi, Pakistan. We service both domestic and international clients. IMS was ranked #2 Best Local Brokerage and #3 Best for Overall Country Research for 2016 by AsiaMoney.
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