By Ariba Shahid
If you're looking to invest in Pakistan, now might be the perfect time. Pakistan's central bank is expected to cut its key interest rate during its upcoming policy meeting, following a drop in inflation to single digits in August for the first time in nearly three years.
Analysts predict another rate cut, with expectations ranging from 100 basis points to 200 bps. This would continue the trend from previous cuts in June and July, bringing rates down from 22% to 19.5%.
The recent reductions were made possible by a staff level agreement with the IMF and a new state budget with ambitious revenue targets. Central bank chief Jameel Ahmed has stated that these cuts have had the desired effect, with inflation slowing and the current account remaining stable.
Economist Ammar Habib believes that with low inflation risks and a prudent fiscal stance, a 200 bps cut would make sense without causing major disruptions to FX expectations.
Analysts from various organizations are predicting cuts ranging from 100 to 200 bps, with a median expectation of 150 bps.
Overall, these rate cuts could have a positive impact on the Pakistani economy, making it a potentially attractive opportunity for investors. Keep an eye on the central bank's decision to stay informed about the latest developments.
Analysis: Pakistan's central bank is likely to cut interest rates further, which could stimulate economic growth and investment opportunities in the country. Investors should monitor these developments closely to make informed decisions about their portfolios.