No emergency meeting of MPC, says SBP

ISLAMABAD: The State Bank of Pakistan (SBP) refuted reports of convening an emergency meeting of the Monetary Policy Committee (MPC) as the local currency experienced a historic decline against the US dollar.

In a statement issued on Friday, the central bank dismissed the circulating media reports regarding an emergency MPC meeting as “completely baseless.” This statement follows the local currency’s drop to Rs305.54, losing Rs1.09 in the interbank market on Thursday, while the open market price for the US dollar exceeded Rs320.

Furthermore, the Pakistan Stock Exchange (PSX) observed a significant decline on Thursday, with the benchmark index plummeting by over 2 percent. This downturn was attributed to concerns over the deteriorating economic situation in the country.

Dollar goes up, Reserves go down, economy goes round and round

Investors reacted with alarm to the escalating rupee-dollar exchange rate, opting to divest their shares due to apprehensions of an impending economic crisis.

Amidst the prevailing uncertainty and speculations about the SBP holding an emergency MPC meeting to reconsider the key policy rate and address the local currency’s decline, the SBP clarified that it would be premature to predict future policy rates. Only the MPC, an independent statutory body, possesses the authority to make decisions regarding policy rates.

The statement also noted that the next scheduled meeting of the MPC is set for September 14, 2023, during which it will assess economic developments and make appropriate decisions in this regard.