·         We anticipate the central bank to initiate the first round of monetary easing with a token rate cut of 100-150bps in the upcoming committee meeting.

·         Both Ghana and Sri Lanka, operating under the IMF program, reduced their benchmark rates at the first sign of positive real rates during the last twelve months.

·         In contrast, Pakistan’s CPI peaked at 37.96%YoY in May’23, with the inflation/policy rate differential now stretching to an unprecedented 1,024bps as of May’24.

·         The IMF’s call to durably entrench disinflationary trends continues to be heeded, with the second consecutive MoM drop in NCPI readings during May’24.

·         Moving forward, we do not see currency under pressure over the routine 5-7% depreciation during FY25E.

 Courtesy – AKD Research