SBP to declare monetary policy on May 16, deposit growth slows down

581340-dollar-1374667788-810-640x480

KARACHI: On Tuesday, State Bank of Pakistan (SBP) will announce a country’s monetary policy on May 16, while the analysts said that the expectations relating to any slice in the price reduction rate has gone down.

Advertisement

It was recently disclosed that the State Bank of Pakistan is about to publish a new monetary policy. While many were expecting that the discount rate would change with the upcoming monetary policy, the IMF and the inflation rate did not allow this to happen. This is the reason why it was recently revealed that the monetary policy and the discount rates are going to remain unchanged.

Increase in deposits has slowed down slightly from 14% year-on-year in December 2013, as the SBP has committed to reducing growth in domestic money supply under the International Monetary Fund (IMF) agreement, as stated to analysts.

One more expert also stated, “Given the likely inflation path and the province of foreign exchange reserves of the central bank, I believe the SBP will opt for keeping the interest rate on hold for today.

Year-on-year increase in the deposits placed under the category of ‘Other personal’ remained 13.2% at the close of March as opposed to the addition of 8.5% under the class of self-employed people. Increase in the deposits of salaried people during the 12-month period clocked up at 17.4%.

In the middle of July 1, 2013 and April 25, 2014, money supply increased by Rs476 billion as compared to Rs654 billion for the same point in the previous financial year.

Advertisement