ON May 11, the State Bank of Pakistan increased the cut-off yield on three-month and one-year treasury bills by one percentage point each. It sold worth Rs84.47 billion three-month bills at a maximum rate of 7.38 per cent and Rs3.25 billion a year bills at 8.25 per cent. This is the second big increase in three-month and one-year government papers within a month.
The State Bank has been increasing the interest rates to contain the rising inflation which is forecast at around 9 per cent for the year. According to the Statement of Affairs of the Bank for the week ended April 30, 2005, both notes in circulation and issued decreased. Notes in circulation stood at Rs706,713.731 million against the earlier week’s figure of Rs709,975.116 million, a fall of Rs3,271.385 million. When compared to the corresponding week a year ago it was Rs616,454.567 million, the current week’s figure is higher by Rs90,259.164 million.
Total notes issued also fell in the current week over the preceding week’s level. At Rs706,923.228 million it was smaller by Rs3,236.987 million over the figure of Rs710,160.215 million recorded a week earlier. In the corresponding week last year it amounted to Rs616,599.509 million, which shows current figure to be higher by Rs90,323.719 million over last year’s.
The approved foreign exchange rose to Rs506,135.236 million or by Rs826.416 million over preceding week’s figure of Rs505,308.820 million. When compared to the corresponding week a year ago, when the figure was Rs462,478.468 million, the current week’s figure was higher by Rs43,656.768 million.
Balances held outside Pakistan in approved foreign exchange increased in the week under review. It stood at Rs127,377.302 million over preceding week’s figure of Rs127,155.314 million, a rise of Rs221.988 million. Compared to last year’s corresponding figure of Rs180,964.231 million, the current week’s figure is smaller by Rs53,586.929 million.
Loans and advances of scheduled banks to the three sectors – agricultural, industrial and export showed a mixed trend in the week under review. The agricultural sector received Rs59,576.437 million, against preceding week’s figure of Rs59,009.437 million, a rise of Rs567 million. The current week’s figure is larger by Rs3,620.898 million over last year’s corresponding figure of Rs55,955.539 million.
There was an inflow of Rs1,317.064 million to the industrial sector during the week under review, against preceding week’s figure of Rs1,302.866 million, a rise of Rs14.198 million. When compared to last year’s corresponding figure of Rs2,363.904 million, the current week’s figure is lower by Rs1,046.84 million.
The export sector received Rs110,571.179 million against previous week’s figure of Rs109,225.721 million, a rise of Rs1,345.458 million. Current week’s figure was larger by Rs26,595.965 million over last year’s corresponding figure of Rs83,975.214 million.
According to the weekly statement of position of scheduled banks for the week ended April 30, 2005, the sum of demand and time liabilities rose in the week under review. The sum total stood at Rs2,400,295 million against preceding week’s Rs2,375,972 million, a rise of Rs24,323 million. As compared to the total deposits of Rs1,985,201 million in the corresponding period last year, current week’s deposits were higher by Rs415,094 million.
During the week under review, demand deposits stood at Rs1,220,782 million, a rise of Rs.9,332 million over previous week’s Rs1,211,450 million. It was also higher against last year’s corresponding figure of Rs993,117 million by Rs227,665 million.
Time deposits rose in the current week. At Rs1,179,513 million it was higher by Rs14,991 million over previous week’s Rs1,164,522 million and by Rs187,429 million over last year’s corresponding figure of Rs992,084 million.
Scheduled banks borrowings from the State Bank of Pakistan against promissory notes and other approved securities rose in the current week. At Rs188,433 million it was higher by Rs2,306 million over preceding week’s Rs186,127 million. Compared to last year’s corresponding figure of Rs155,747 million, the current week’s figure is higher by Rs32,686 million.
Scheduled banks borrowings from banks abroad stood at Rs5,993 million in the current week, as against Rs4,459 million a week ago, a rise of Rs1,534 million. It was however, lower by Rs477 million over last year’s corresponding figure of Rs6,470 million.
Money at call and short notice in Pakistan fell in the week under review as against previous week’s figure. It stood at Rs24,836 million, a fall of Rs2,845 million over preceding week’s Rs27,681 million. When compared to last year’s corresponding figure of Rs28,339 million, the current week’s figure is smaller by Rs3,503 million.
Scheduled banks’ advances including bills purchased and discounted increased in the week under review. At Rs1,720,973 million it was higher by Rs14,197 million over preceding week’s Rs1,706,776 million. Compared to the corresponding figure a year ago, when advances were to the tune of Rs1,247,420 million, the current week’s advances are higher by Rs473,553 million.
Scheduled banks investment in central government securities, Treasury bills and other approved securities showed a rise in the current week when compared to preceding week’s level. Such investments amounted to Rs670,990 million, a rise of Rs834 million over previous week’s Rs670,156 million. Compared to last year’s corresponding figure of Rs770,030 million, the current week’s investment is smaller by Rs99,040 million.
Total assets of scheduled banks rose in the week under review. These stood at Rs3,422,581 million against previous week’s Rs3,397,879 million, a rise of Rs24,702 million. Compared to last year’s corresponding figure of Rs2,814,462 million, it shows a rise of Rs608,119 million.
ON May 11, the State Bank of Pakistan increased the cut-off yield on three-month and one-year treasury bills by one percentage point each. It sold worth Rs84.47 billion three-month bills at a maximum rate of 7.38 per cent and Rs3.25 billion a year bills at 8.25 per cent. This is the second big increase in three-month and one-year government papers within a month.
