SBP watch (and other hot takes)

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Fifth Generation (Warfare) Monetary Policy at SBP
dmkm.substack.com

Fifth Generation (Warfare) Monetary Policy at SBP

SBP has gone full ISPR. One should never go full ISPR.

DMKM
Nov 29, 2021
3
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Fifth Generation (Warfare) Monetary Policy at SBP
dmkm.substack.com

The timeline of SBP’s Reza Baqir’s charm offensive that I provided in my post Sovereignty lies with IMF: Part Deux.

  • Nov 19: RB interview to Kamran Khan

  • Nov 20: RB interview to The Profit

  • Nov 23: RB interview to FT

  • Nov 23: RB pens Op Ed for Dawn

  • Nov 24: RB interview to CNBC

I guess the above scorched-earth campaign didn’t have any effect. So

  • Nov 29: SBP now issues another clarification.

Twitter avatar for @StateBank_PakSBP @StateBank_Pak
#SBP issues clarification to dispel misinterpretation circulating in certain sections of the media about previous monetary policy decisions. See

November 29th 2021

17 Retweets63 Likes

I wish I had come up with the below tweet to describe these addendums to Reza Baqir’s SBP’s monetary policy statement.

Twitter avatar for @Sehbanلا أحد ابن لا أحد @Sehban
@2paisay 5th generation monetary policy

November 29th 2021

1 Retweet

There are many tweets describing the clarification, but this sums it up best.

Twitter avatar for @rogueonomistAmmar Khan @rogueonomist
Which third year analyst wrote this op-ed?

SBP @StateBank_Pak

#SBP issues clarification to dispel misinterpretation circulating in certain sections of the media about previous monetary policy decisions. See https://t.co/BzV7jnt6iv

November 29th 2021

3 Likes

There isn’t anything to analyze in the clarification. It is amusing to see how thin-skinned SBP has become. I have selected a few amusing sentences.

Over the past few weeks, certain sections of the media including op-eds have expressed concerns over the actions of the SBP.

Such points are all easier made in hindsight but let us remind ourselves what the situation was actually like back in May and July 2021.

It is quite easy, in hindsight, to criticize this decision even though no tangible alternatives were proposed in the op-eds or elsewhere at the time.

I really like the above sentence.

Twitter avatar for @rogueonomistAmmar Khan @rogueonomist
Yea, guess what op-eds are not central banks, they are random people writing random stuff to fill up pages mostly out of boredom. It is the central bank's job to do its job, not op-ed's job to prescribe solutions lol

DMKM @2paisay

“It is quite easy, in hindsight, to criticize this decision even though no tangible alternatives were proposed in the op-eds or elsewhere at the time.”

November 29th 2021

7 Likes
Twitter avatar for @UzairYounusUzair Younus عُزیر یُونس @UzairYounus
Is it international best practice for a central bank to issue clarifications based on criticism in the media? The US Fed has been criticized by many commentators, including in the opinion pages of the WSJ. But it has not issued similar clarifications. Why so sensitive?

SBP @StateBank_Pak

#SBP issues clarification to dispel misinterpretation circulating in certain sections of the media about previous monetary policy decisions. See https://t.co/BzV7jnt6iv

November 29th 2021

1 Retweet11 Likes

Kudos to whoever came up with the below sentence.

In the midst of a once-in-a-century pandemic, it would be imprudent to solely superimpose classical economic theories onto data outturns.

That is not all. Saudi Arabia recently provided us with a loan of $4.2 Billion ($3Billion one-year loan callable at 3 days notice and $1.2Billion oil import facility).

Twitter avatar for @81ShahbazRanaShahbaz Rana @81ShahbazRana
⁦@thereviewexp⁩ brings details of Pakistan-Saudi Arabia $3 billion loan deal. Interest rate will be 4%. Saudi Arabia has given loan for one year but can withdraw within 72 hours by giving a notice in writing. More 👇 here.

November 27th 2021

505 Retweets1,027 Likes

SBP thinks calling it a deposit might take attention away from the harsh conditions of the loan.

Twitter avatar for @StateBank_PakSBP @StateBank_Pak
1/2 Saudi Fund for Development signed the agreement today with #SBP representing the Govt of Pakistan for a $3bn deposit at #SBP that will become part of SBP’s Foreign Exchange Reserves. PR:
sbp.org.pk/press/2021/Pr-… @SaudiFund_Dev @AhmedAlKhateeb @Saalmarshad #ProsperTogether

November 29th 2021

17 Retweets85 Likes
Twitter avatar for @StateBank_PakSBP @StateBank_Pak
2/2 The deposit agreement reflects the strong and special relationship and will augment economic ties between the two brotherly countries.

November 29th 2021

5 Retweets50 Likes

Others have said it best

Twitter avatar for @rogueonomistAmmar Khan @rogueonomist
Can someone like tell SBP that it's supposed to act independent and not really work with adjectives like 'special' and 'brotherly' -- y'know independent...

SBP @StateBank_Pak

2/2 The deposit agreement reflects the strong and special relationship and will augment economic ties between the two brotherly countries.

November 29th 2021

29 Likes
Twitter avatar for @rogueonomistAmmar Khan @rogueonomist
What brother puts in cross default provisions and demands repayment in three days -- that's an abusive relationship people, it's time to go for family therapy.

November 29th 2021

1 Retweet19 Likes

Sehban bhai with sage advice.

Twitter avatar for @Sehbanلا أحد ابن لا أحد @Sehban
@rogueonomist SBP has gone full ISPR !! No serious institution should go full ispr

November 29th 2021

1 Like

Azam offering his shoulder.

Twitter avatar for @AzamAKhan2Azam A. Khan @AzamAKhan2
Reza bhai, if you need a cuddle, I'm here for you.

DMKM @2paisay

Scorched earth PR campaign by SBP governor not having any effect. Nov 19: RB interview to Kamran Khan Nov 20: RB interview to The Profit Nov 23: RB interview to FT Nov 23: RB pens Op Ed for Dawn Nov 24: RB interview to CNBC Nov 29: SBP issues clarification https://t.co/qHABWxN6Ju

November 29th 2021

2 Likes
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Fifth Generation (Warfare) Monetary Policy at SBP
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