Despite the improvement in the USD exchange market, the State Bank of Pakistan (SBP) forecast that the inflation rate would begin to decline in November, according to ARY News on Thursday.
In a statement, the central bank noted that cotton imports have increased and agriculture sectors have improved. It also mentioned how the USD exchange market had improved as a result of the administration’s strict measures.
The central bank made stern suggestions about how it would control commodity prices nationwide. By 2025, it aimed to bring the inflation rate down to 5 or 7%.
The SBP anticipated that the rate of inflation would be high in October and decline in November.
A new monetary strategy
According to a press release issued today, the State Bank of Pakistan (SBP) on Thursday decided to maintain the key policy rate at 22 percent.
Following a meeting of the bank’s Monetary Policy Committee (MPC), the announcement was made.
Even though oil prices have recently increased globally, the MPC noted that inflation is still expected to trend downward, particularly starting in the second half of this year.
The tight monetary policy stance, improved agricultural prospects, and recent administrative and regulatory reforms, according to the MPC, will all contribute to meeting the medium-term inflation target.
The committee also emphasised the need to maintain a responsible fiscal posture in order to restrain aggregate demand.
The MPC stated that it will keep an eye on the risks to the inflation outlook and, if necessary, will take the necessary steps to achieve price stability.
In order to control aggregate demand, the MPC also emphasised maintaining a prudent fiscal posture.
This is necessary to achieve the medium-term target of 5-7% by the end of FY25 and to reduce inflation on a sustainable basis.
