Stocks at the Pakistan Stock Exchange (PSX) witnessed an upward trajectory on Tuesday with the benchmark KSE-100 Index surging past the 65,000 level, backed by the confidence built after the policy rate announcement.
The SBP’s decision to maintain the policy rate at 22% catalyzed a rally in the KSE-100 index, which soared by 612.09 points or 0.94% to close at 65,502.59 points.
The market experienced widespread buying activity, with major sectors such as automotive, refineries, and oil marketing companies (OMCs) all showing positive performance.
Experts have linked this bullish sentiment to anticipations that the central bank would maintain the current monetary policy.
Addressing the rationale behind their decision, the Monetary Policy Committee (MPC) of the SBP highlighted that inflation has started to recede as predicted, particularly in the second half of the fiscal year 2024.
However, the committee also noted that despite a marked slowdown in February, inflation levels remain elevated, and the outlook is fraught with risks, given the high inflation expectations.
This situation necessitates a prudent approach, with the continuation of the current monetary policy deemed essential to reduce inflation to the targeted range of 5–7% by September 2025.
The PSX’s benchmark KSE-100 index had a subdued close on Monday, oscillating in anticipation of the monetary policy announcement. The index ultimately settled at 64,890.51, a modest gain of 74.04 points or 0.11%.
