On January 31, 948194848732025, Friday, the Pakistan Stock Exchange (PSX) saw a significant increase, with the benchmark KSE-100 index rising by 1,096 points (0.97%), closing at 114,302.40 points. This positive trend was primarily driven by strong corporate earnings reports, particularly in the banking sector, which announced final dividends that exceeded expectations. Earlier this week, the State Bank of Pakistan lowered the policy rate by 100 basis points to 12%, citing a continued trend of deflation. The central bank also revised its inflation forecast for the fiscal year 2025 from a previous range of 11.5% to 13.5% down to a range of 5.5% to 7.5%. Despite the overall positive performance this week, the daily trading volume on the PSX decreased by 29% week-on-week, indicating cautious investor sentiment. In summary, the PSX closed higher this week, buoyed by corporate earnings and adjustments in monetary policy, but the decline in trading volume suggests that investors remain vigilant.