{"id":5153,"date":"2025-06-12T20:10:12","date_gmt":"2025-06-12T15:10:12","guid":{"rendered":"https:\/\/pkfin.kotenterprises.dev\/?p=5153"},"modified":"2025-06-12T20:10:12","modified_gmt":"2025-06-12T15:10:12","slug":"brokerage-firms-expects-no-change-in-policy-rate-in-upcoming-mpc-meeting","status":"publish","type":"post","link":"https:\/\/pkfin.kotenterprises.dev\/?p=5153","title":{"rendered":"Brokerage Firms Expects No Change in Policy Rate in Upcoming MPC Meeting"},"content":{"rendered":"

KARACHI, June 12, 2025<\/em> \u2014 The State Bank of Pakistan (SBP)<\/a> is scheduled to announce its monetary policy decision on June 16, 2025, with a majority of market participants and analysts expecting the central bank to keep the policy rate unchanged, according to a poll conducted by Topline Securities.<\/p>\n

The brokerage house noted that 56 percent of respondents in its latest survey anticipate a status quo in the upcoming Monetary Policy Committee (MPC) meeting, a notable increase from 31 percent in the previous poll. Meanwhile, 44 percent of participants are expecting a rate cut of at least 50 basis points (bps), with 19 percent expecting a 50bps cut and 25 percent anticipating a more aggressive 100bps cut.<\/p>\n

Topline Securities stated that while there is room for a further 100bps rate cut, they expect the SBP to maintain the current policy rate due to several emerging risk factors. The brokerage projects inflation for FY26 to average between 6-7 percent, which would translate into a real interest rate of 400-500bps (assuming a policy rate of 11 percent)\u2014significantly higher than the historical average real rate of 200-300bps.<\/p>\n

“Despite this room, we expect the central bank<\/a> to adopt a cautious stance in light of rising international oil prices and pending domestic utility price adjustments,” Topline said.<\/p>\n

Brent crude prices have recently rebounded to $68\u2013$70 per barrel, driven by escalating geopolitical tensions in the Middle East and progress toward a potential U.S.\u2013China trade deal. Given the historical role of energy prices in fueling inflation, Topline believes the SBP will likely wait for more clarity before making further cuts.<\/p>\n

Additionally, key fiscal decisions\u2014including gas and electricity price notifications\u2014are expected before the start of the new fiscal year. The inflationary impact of these changes is yet to be fully assessed.<\/p>\n

Notably, in its previous meeting on May 5, 2025, the MPC cut the policy rate by 100bps<\/a>, with eight out of nine members voting in favor of the move. Following the rate cut, yields on both the 6-month KIBOR and T-bills declined by 88\u201399bps. Currently, the 6-month KIBOR stands at 11.09 percent, while the 6-month T-bill yield is 10.95 percent.<\/p>\n

Topline also surveyed market expectations for interest rates and inflation<\/a> by December 2025. According to the poll:<\/p>\n