The State Bank of Pakistan on November 10, injected Rs11.3 billion into the banking system through reverse repos of treasury bills at an open market operation.
The central bank injected Rs5.1 billion for one week at 1.85 per cent and Rs6.2 billion for two weeks at 2 per cent. But the injection fell short of the market demand for extra cash. This demand that reflected in the offers for the reverse repos of T-bills totalled Rs21.7 billion against which the SBP accepted Rs11.3 billion offers and rejected the rest.
The State Bank of Pakistan on November 13 again injected Rs13.75 billion into the interbank money market to ease off the temporary liquidity crunch the banks are facing due to withdrawal of money by people for Eid shopping. This is the third injection of fund into the money market by the SBP so far during Ramazan. Earlier on November 6 and on November 10, the central bank had injected Rs7.35 billion and Rs11.3 billion, respectively, into the banking system.
According to the Statement of Affairs of the State Bank of Pakistan, for the week ended November 1, 2003, both notes in circulation and those issued increased further in the week under review. Notes in circulation stood at Rs581,646.852 million against earlier week’s figure of Rs568,395.352 million, showing a rise of Rs13,251.5 million. When compared to the corresponding week a year ago when it was Rs480,490.810 million, the current week’s figure is higher by Rs101,156.042 million.
Total notes issued also recorded a rise in the current week. At Rs581,734.256 million it was larger by Rs13,181.15 million over the figure of Rs568,553.106 million recorded a week earlier. In the corresponding week last year it amounted to Rs480,641.814 million, which shows current week’s figure to be higher by Rs101,092.442 million over last year’s figure.
Approved foreign exchange declined in the week, falling to Rs498,689.541 million, or by Rs3,272.935 million over preceding week’s figure of Rs501,962.476 million. When compared to the corresponding week a year ago, when the figure was Rs356,674.928 million, the current week’s figure was higher by Rs142,014.613 million.
Balances held outside Pakistan in approved foreign exchange showed an increase in the week under review. It stood at Rs90,817.599 million over preceding week’s figure of Rs86,852.763 million, showing a rise of Rs3,964.836 million. Compared to last year’s corresponding figure of Rs43,647.696 million, the current week’s figure is substantially higher by Rs47,169.903 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 Rs54,947.895 million similar to preceding week’s figure. The current week’s figure is larger by Rs1,042.869 million over last year’s corresponding figure of Rs53,905.026 million.
There was an inflow of Rs2,690.829 million to the industrial sector during the week under review, depicting a decline of Rs2.44 million over previous week’s Rs2,693.269 million. When compared to last year’s corresponding figure of Rs3,259.671 million, the current week’s figure is lower by Rs568.842 million.
The export sector received Rs67,056.334 million against previous week’s figure of Rs66,383.283 million, showing a rise of Rs673.051 million. Current week’s figure was larger by Rs17,352.568 million over last year’s corresponding figure of Rs49,703.766 million.
According to the weekly statement of position of scheduled banks for the week ended November 1, 2003, the sum of demand and time liabilities increased in the week under review as against a decline recorded in the earlier week. The sum total stood at Rs1,805,514 million against preceding week’s Rs1,787,827 million, showing a rise of Rs17,687 million. As compared to the total deposits of Rs1,534,303 million in the corresponding period last year, current week’s deposits were higher by Rs271,211 million.
During the week under review, demand deposits decline while time deposits rose. Demand deposits fell to Rs904,464 million, a decline of Rs53,445 million over previous week’s Rs957,909 million. It was however higher against last year’s corresponding figure of Rs679,899 million by Rs224,565 million. In the current week, time deposits rose over preceding week’s figure. At Rs901,050 million, it was larger by Rs71,132 million over previous week’s Rs829,918 million and higher Rs46,646 million, over last year’s corresponding figure of Rs854,404 million.
Scheduled banks borrowings from the State Bank of Pakistan against promissory notes and other approved securities increased in the current week. At Rs143,749 million it was larger by Rs429 million over preceding week’s Rs143,320 million.