State Bank of Pakistan is all set to announce its Monetary Policy today around 4pm. Secondary Market Yields have adjusted for 150 to 200 bps increase.
While Analysts are of the opinion that at least 100bps increase is imminent. In the last T-Bills Auction, Government had to face a tough call from the Banks which led to massive increase in T-Bills Yields which rose to 11.5%. This clearly doesn’t digest well with the government as PM Advisor on Finance Shaukat Tarin took to the media and called out banks for their ‘UnJust’ behviour.
State Bank of Pakistan is likely to take note of the Banks Greed which is leading to higher secondary market yields. SBP is expected to take a measured and gradual instance which is likely to lead to an increase of 50bps to 75bps in today’s Monetary Policy. This will halt the rates to some extent and may put downward pressure on market yields.
SBP has numerous Monetary Policy meetings lined up in next year to take note of the situation and take appropriate steps. Hence, SBP is likely to take a measured approach this time and put the market in a positive surprise.
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