The business community is already jittery due to likely introduction of new taxes, no reduction in interest rate, but more distressing hike in electricity and gas tariffs.
Analysts believe, Pakistan’s current account just can’t be improved without restoring competitiveness of the local manufacturers.
During this past week, Moody’s statement suggesting a status quo in the upcoming MPC meeting exerted some pressure on the stock market.
Looking ahead, the upcoming MPC meeting on June 10 will be in the spotlight, with any rate cut expected to shift the market’s focus towards cyclical sectors.
More than two years into the steepest interest-rate tightening cycle in decades, central banks around the world are grappling with how fast to unwind the policy. Policymakers from South Korea to Canada are weighing progress on slowing inflation, and some have started cutting rates.
Policymakers in Latin America have been trimming since earlier this year. While that all marks a major milestone, price pressures have proven stubborn, a strong dollar has roiled developing nations and geopolitical tensions have added a layer of uncertainty to the post-pandemic economic recovery.
US Federal Reserve officials will meet next week and are widely expected to hold interest rates steady as the US economy hums along and the labor market keeps firing on all thrusters.
The Labor Department data this week suggesting last year’s payroll gains might not have been as robust as first counted, there’s now the risk that Fed Chair Jerome Powell and his colleagues could keep monetary policy too tight for too long.
Even as the Fed’s central bank peers diverge (the en-vogue term for the current unwinding cycle), rate cuts by the European Central Bank and the Bank of Canada “are less bold departures and more like components of a mosaic,” Daniel Moss writes in Bloomberg Opinion. “Harmony has been breaking down for a while.”
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