KARACHI, Oct 20: The State Bank on Wednesday injected Rs14 billion into the banking system to ease off the temporary liquidity crisis and help banks to finance Eid-related withdrawals from bank deposits.

Bankers said the central bank injected Rs14 billion into the system through one-week reverse repo of treasury bills at 4.2 per cent at an open market operation called for this purpose. They said that this injection coupled with a Rs5 billion inflow through maturity of a previous OMO eased off the liquidity shortage and left the market surplus with a few billion rupees.

On Tuesday and Monday, banks had to borrow overnight funds from the State Bank's discount window at a high rate of 7.5 per cent to meet their daily cash requirements. On Monday, they had borrowed Rs755 million and on Tuesday Rs7.9 billion.