Karachi, November 17, 2014 (PPI-OT): Economy
Giving a clear signal to the market that the lending rates have peaked and will now reverse, SBP decided to cut its policy rate by 50 basis points, i.e., from 10%to 9.50% with effect from November 17, 2014.
The advisory committee consisting of internal and external economists met an hour before the Central Board of SBP and its members were evenly split over whether or not there should be a cut. While there was still more room for a larger cut ‐ SBP directors felt that some of the expected forex inflows such a Sukuk bonds and USD 1.1bn from the Fund required some more time to materialise.
The board also noted that there is a slight increase (PKR 47bn) in first quarter of FY15; however, they felt it was an insignificant increase in terms of overall borrowing and it may be due to energy constraints faced by textile and fertiliser sectors.
State Bank of Pakistan said on Sunday night that operation of KASB Bank Limited has not been suspended and all its branches will remain open today (Monday) and locker‐holders can operate their lockers, as usual.
According to SBP’s statement issued on November 16, 2014 in terms of the Moratorium placed on KASB Bank Ltd on November 14, 2014, the central bank clarified that KASB Bank operations are not suspended; therefore, offices and branches of the bank will remain open as per their normal timings.