On February 19, the central bank lowered the cut-off yields on 3-month and 1 year Treasury bills by 22 basis points and 9 basis points to sell Rs10.10 billion worth of these bills.

The State Bank had in November lowered its discount rate by 1.5 percentage point to 7.5 per cent. This was followed by gradual lowering of T-bill rates of all maturities. Lending rates have also been lowered by the commercial banks.

According to the Statement of Affairs of the State Bank of Pakistan, for the week ended February 8, 2003, both notes in circulation and those issued showed an increase in the week under review. Notes in circulation stood at Rs531,994.707 million against earlier week’s figure of Rs511,523.100 million, showing a rise of Rs20,471.607 million. When compared to the corresponding week a year ago when it was Rs461,087.582 million, the current week’s figure is higher by Rs70,907.125 million.

Total notes issued also recorded a rise in the current week. At Rs532,178.820 million it was higher by Rs20,495.316 million over the figure of Rs511,683.504 million recorded a week earlier. In the corresponding week last year it amounted to Rs461,247.570 million, which shows current week’s figure to be higher by Rs70,931.25 million over last year’s figure.

Approved foreign exchange rose further in the week to Rs454,329.344 million, larger by Rs6,583.452 million over preceding week’s figure of Rs447,745.892 million recorded a week earlier. When compared to the corresponding week a year ago, when the figure was Rs150,870.260 million, the current week’s figure was higher by Rs303,459.084 million.

Balances held outside Pakistan in approved foreign exchange declined in the week under review. It stood at Rs48,669.147 million over preceding week’s figure of Rs51,814.288 million, showing a decrease of Rs3,145.141 million. Compared to last year’s corresponding figure of Rs67,215.526 million, the current week’s figure is also lower by Rs18,546.379 million.

Loans and advances of scheduled banks to the three sectors — agricultural, industrial and export showed a mixed picture in the week under review. The agricultural sector received Rs55,056.769 million against preceding week’s figure of Rs54,131.769 million, showing a rise of Rs925 million. The current week’s figure is lower by Rs123.328 million over last year’s corresponding figure of Rs54,933.441 million.

There was an inflow of Rs2,978.630 million to the industrial sector during the week under review, depicting a decline of Rs4.007 million over previous week’s Rs2,982.637 million. When compared to last year’s corresponding figure of Rs3,689.601 million, the current week’s figure is lower by Rs708.971 million. The export sector received Rs45,650.510 million over previous week’s figure of Rs46,142.723 million, showing a fall of Rs492.213 million. Current week’s figure was larger by Rs4,004.066 million over last year’s corresponding figure of Rs49,654.576 million.

According to the weekly statement of position of scheduled banks for the week ended February 8, 2003, the sum of demand and time liabilities declined in the week under review. The sum total stood at Rs1,609,573 million against preceding week’s Rs1,610,751 million, showing a fall of Rs1,178 million. As compared to the total deposits of Rs1,368,276 million in the corresponding period last year, current week’s deposits were higher by Rs241,297 million.

During the week under review time deposits increased, while demand deposits fell. Demand deposits declined to Rs733,737 million, or by Rs3,239 million over previous week’s Rs736,976 million. It was however, higher against last year’s corresponding figure of Rs603,918 million by Rs129,819 million.

In the current week, time deposits were higher over the preceding week and against the corresponding week last year. At Rs875,836 million, it was higher by Rs2,061 million over previous week’s Rs873,775 million, and by Rs111,478 million, over last year’s corresponding figure of Rs764,358 million.

Scheduled banks borrowings from the State Bank of Pakistan against promissory notes and other approved securities declined in the current week. At Rs136,471 million it was smaller by Rs257 million over preceding week’s RS136,728 million. Compared to last year’s corresponding figure of Rs119,984 million, the current week’s figure is higher by Rs16,487 million.

Scheduled banks borrowings from banks abroad stood at Rs14,182 million in the current week, as against Rs13,911 million a week ago, showing a fall of Rs271 million. It was smaller by Rs1,051 million over last year’s corresponding figure of Rs15,233 million.