On September 15, the State Bank of Pakistan raised the average yield on the 6-month paper from 2.62 per cent to 3 per cent and managed to sell Rs1.1 billion worth of Treasury bills at this rate.

By raising the T-bills rates, the SBP has sent a signal that it is stepping up efforts to check inflation. The central bank had started to raise gradually the T-bills rates in February 2004. The auction had generated Rs5.7 billion worth of bids, of which the SBP accepted Rs1.1 billion.

According to the weekly statement of position of scheduled banks for the week ended September 4, 2004, the sum of demand and time liabilities rose in the week under review.

The sum total stood at Rs2,173,967 million against preceding week's Rs2,154,434 million, a rise of Rs19,533 million. As compared to the total deposits of Rs1,789,496 million in the corresponding period last year, current week's deposits were higher by Rs384,471 million.

During the week under review, demand deposits stood at Rs1,094,111 million, a rise of Rs576 million over previous week's Rs1,093,535 million. It was also higher against last year's corresponding figure of Rs857,601 million by Rs236,510 million.

Time deposits increased in the current week. At Rs1,079,856 million it was larger by Rs18,957 million over previous week's Rs1,060,899 million and by Rs147,961 million over last year's corresponding figure of Rs931,895 million.

Scheduled banks borrowings from the State Bank of Pakistan against promissory notes and other approved securities fell further in the current week. At Rs143,080 million it was smaller by Rs9,619 million over preceding week's Rs152,699 million. Compared to last year's corresponding figure of Rs125,595 million, the current week's figure is higher by Rs17,485 million.

Scheduled banks borrowings from banks abroad stood at Rs7,876 million in the current week, as against Rs7,095 million a week ago, a rise of Rs781 million. It was smaller by Rs12,276 million over last year's corresponding figure of Rs20,152 million.

Money at call and short notice in Pakistan increased in the week over previous week's figure. It stood at Rs42,547 million, a rise of Rs.2,659 million over preceding week's Rs39,888 million. When compared to last year's corresponding figure of Rs19,044 million, the current week's figure is higher by Rs23,503 million.

Scheduled banks' advances including bills purchased and discounted rose in the week under review. At Rs1,370,723 million it was larger by Rs5,802 million over preceding week's Rs1,364,921 million. Compared to the corresponding figure a year ago, when advances were to the tune of Rs1,038,842 million, the current week's advances are higher by Rs331,881 million.

Scheduled banks investment in central government securities, Treasury bills and other approved securities increased in the current week when compared to preceding week's level.

Such investments amounted to Rs783,863 million, a rise of Rs7,354 million over previous week's Rs776,509 million. Compared to last year's corresponding figure of Rs771,579 million, the current week's investment is higher by Rs12,284 million.

Total assets of scheduled banks increased in the week under review. These stood at Rs3,070,408 million against previous week's Rs3,060,995 million, a rise of Rs9,413 million. Compared to last year's corresponding figure of Rs2,544,851 million it shows a rise of Rs525,557 million.