Karachi: Pakistan’s stock market is poised for continued momentum as the State Bank of Pakistan (SBP) accelerates its monetary easing efforts, reducing the policy rate by 250 basis points to 15%. This move is in response to a decline in inflation, which now aligns with the central bank’s medium-term target range. Economic signals are positive, with initial estimates of Kharif crops surpassing expectations and industrial activity on the rise.

According to AKD Securities Limited, the Monetary Policy Committee (MPC) has maintained its forecast for the current account deficit (CAD) to remain between 0-1% of GDP for the fiscal year 2025. This optimistic outlook is supported by strong workers’ remittances and increased export activities. The persistent monetary easing, driven by a disinflationary environment and an improving macroeconomic landscape, is expected to enhance the attractiveness of equity investments, which are currently trading at a price-to-earnings (P/E) ratio of 4.1x and a dividend yield (DY) of 11.2%.