The State Bank of Pakistan on Friday kept the monetary policylink rate unchangedlink at 7 percent.
In a statement, SBP link said thatthe monetary policylink committee(MPC), which met on Friday, decided to maintain the policy rate at 7percent.
“The MPC noted that since the last meeting in January, growth andemployment have continued to recover and business sentiment has furtherimproved. While still modest, at around 3 percent, growth in FY21 is nowprojected to be higher than previously anticipated due to improvedprospects for manufacturing and reflecting in part the monetary and fiscalstimulus provided during Covid.
“The MPC noted that despite the recent slight uptick in market yields,financial conditions remain appropriately accommodative given continuedslack in the economy, on-going fiscal consolidation and well containedrisks to financial stability.
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Following a seasonal contraction due to retirement of working capital loansin January, private sector credit has resumed its expansionary trend acrossall major lending categories.
Through FY21 so far, private sector credit has surpassed last year’scorresponding levels on the back of a sizable expansion in fixed investmentloans and consumer financing, primarily due to the lower interest rateenvironment as well as the SBP’s subsidized refinancing schemes, especiallyLTFF and TERF,” SBP link.
