The State Bank of Pakistan (SBP) has announced that it will neither announce a policy rate nor does it consider it necessary to hold the regular meeting of the Monetary Policy Committee (MPC) in July.
The decision was taken as the central bank made various revisions of the policy rates (five times) and reduced it by 6.25 percent (from 13.25 percent down to 7 percent) to ease off lending for businesses and individuals following the economic slowdown due to COVID-19.
The central bank of Pakistan is one of the few banking regulators of the world that drastically reduced the policy rates after the COVID-19 pandemic.
SBP also introduced specialized schemes for various sectors to encourage borrowing and financing to stimulate the economy and induce investment in the country.
According to the official statement, the next regular meeting of the MPC will now be held in September 2020. The MPC continues to observe economic conditions and stands ready to take whatever actions may become necessary in response to any adverse impact on the economy because of the pandemic or any other factor.
Before 2009, the discount rates were announced twice in a year. After that, the frequency of monetary announcements increased in frequency to a quarterly basis. In 2016, the central bank decided to hold a monetary policy meeting every two months to announce the new policy rates.