SBP terms rumours of emergency MPC meeting ‘completely baseless’

The State Bank of Pakistan (SBP) on Friday dispelled rumours about holding an emergency meeting of the Monetary Policy Committee (MPC), saying that such reports were “completely baseless”.

“The reports making rounds in media about holding of an emergency meeting of the MPC of SBP are completely baseless,” the central bank said on social media platform X (formerly Twitter).

The statement by the central bank comes amid speculation by analysts about the policy rate being hiked to 300 basis points in light of a faltering economy and the steady depreciation of the rupee.

A day earlier, the Pakistan Stock Exchange’s benchmark KSE-100 index had plummeted by around 1,250 points, or 2.7 per cent, with analysts mainly attributing the losses to rumours of an interest rate hike.

Without directly referring to the rumours, the SBP said that it would be “premature to forecast the future policy rate as only the MPC, which is an independent statutory body, is empowered to decide about the policy rate”.

The statement went on to say that the next committee meeting was scheduled for September 14, during which the MPC would “take stock of the economic developments and take [an] appropriate decision in the matter”.

After the previous MPC meeting in July, the SBP had kept the key policy rate unchanged at 22 per cent.

The bank had held rates steady in June saying inflation had peaked at 38pc in the preceding month. But before June’s end, it raised rates by 100 bps at an emergency meeting, citing a “slightly deteriorated inflation outlook”.