FMI ASSIGNMENT

Ans: The monetary policy committee (MPC) lifted the trade rate by 150 basis points to
8.75 percent, implying that the risk of inflation and the balance of payments has grown
while GDP has improved. The risk is related to both global and domestic reasons, and if
we look at the current scenario, pricing pressure has generated supply chain disruption.
As a result of the current scenario, the central bank has tightened monetary policy. When
it comes to Pakistan, greater import prices have resulted in higher CPI, SPI, and inflation.
The current account deficit was larger than expected in December and October, with
rising oil and commodity prices affecting the rupee. As a result, we can conclude that the
balance of risk has shifted away from growth and toward inflation. The current account
deficit was larger than expected in December and October, with rising oil and commodity
prices affecting the rupee. As a result, we can conclude that the balance of risk has shifted
away from growth and toward inflation. With all of this in mind, it's critical to normalise
monetary policy in order to combat inflation and promote stability and growth; an
increase in the current rate is one approach to achieve these objectives.