Karachi: Expectations about the next monetary policy statement will set the direction of the Karachi Stock Exchange the next week, said analysts on Saturday.
The policy is to be announced by the State Bank of Pakistan (SBP) near the end of November. A cut in discount rate, which the banks follow to set their lending rates, pushes the stocks up because lending rates for buying shares also go down, analysts said. It is also positive for the stock markets because listed companies financial charges fall, they added.
The State Bank announces monetary policy after every two months. In the last announcement, it reduced the discount rate by 150 basis points, or 1.5 percentage point, to 12 percent.
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