Highlights of Monetary Policy April-June 2009
Friday, April 24, 2009
State Bank of Pakistan (SBP) announced Monetary Policy Statement (MPS) on 20th April 2009 and slashed discount rate by 100 basis points to 14.00%. - Government‘s fiscal deficit in the first half of current fiscal year reached to Rs.261 billion and government is determined to achieve full year target of Rs 562 billion.
- Tax collection in first nine months reached to Rs 810 billion and in order to meet fiscal year target of Rs 1300 billion, FBR needs to collect Rs 490 billion in next three months.
- Credit to private sector has been slowed significantly during last nine months owing to sluggish demand from corporates and reluctance of commercial banks to lend due to rising level of Non Performing Loans (NPLs). Net credit to private sector fell drastically to Rs 57 billion in July-March 09 period as compare to last year’s Rs 368 billion.
- Credit to manufacturing sector fell by over hundred billion to to Rs 89.4 billion in July-March period as compare to last year’s Rs 193 billion.
- NPLs heightened to Rs 313.7 billion on December 2008 as compare to Rs 241 billion on June 2008. The major nuisances were consumer finance and textile sector and ratio of NPL to advances in textile sector reached to 15%.Since textile sector’s share in total advances was 20%, it hurt banks badly.
- Fall in Working Capital demand was seen and corporates retired some Rs 47 billion in July-March period. This fall was some how sustained by Fixed Investment which reached to Rs 152 billion in first nine months of fiscal year 08- 09 as compare to last year’s Rs 38 billion. Fixed investments were mainly constituted by power and fertilizer sectors which have entered into certain expansion programs.
- Government retired Rs 170 billion to SBP in March end which was mainly financed through Word Bank’s $500 million, deposit from Bank of China worth $500 million and advance tax collection from corporates.
posted @ 10:06 AM,
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