KARACHI: Governor, State Bank of Pakistan (SBP), Dr. Reza Baqir on Mondayassured that the country has come out of the economic crises as it hasachieved economic stability including financial one, which has createdinvestors’ confidence that is very positive signal.
“Uncertainty and instability was a serious challenge to the country, whichis now over as the economic team tackled the situation very effectively.Pakistan’s future is bright,” he said while speaking at his firstinteraction with media here at the SBP Building.
He also answered questions by journalists in Islamabad through a video link.
Dr Reza said the present government had assigned two major tasks to itseconomic team that is, bringing economic stability and ensuring inclusiveeconomic growth in the country; where there is improvement in the life ofthe common man.
“The two main reasons for the economic instability were: external deficitand fiscal deficit. Now, these were being addressed effectively and incredible manner.”
The external/trade deficit situation was improving.
He said it was very positive development that the government had pledgednot to borrow from State Bank of Pakistan.
Instead, he added, it would borrow from the money market. This would saveState Bank of Pakistan from printing new notes which pushed inflation.
About the exchange rate, SBP Governor said a fixed rate or free floatcurrency policy were not in favour of the country.
Rather, SBP had adopted the market-based policy for it.
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Regarding the key interest rate, Dr. Reza said SBP’s Monetary PolicyCommittee did take into account the projected inflation before fixing it.
“We shall be fighting inflation to our best,” he reassured, adding theinterest rate was the best tool to control inflation.
He said the state bank had to work for three objectives including financialstability, maintaining exchange rate and for sustained economic growth.
The SBP Governor defended the agreement being signed with IMF maintainingthat it had sent positive signals to the entire world about financialstability in Pakistan that had also built confidence among the local andforeign investors.
After that, Pakistan Stock Exchange also strengthened.
“Going for IMF loan, everything was being done in the interest of thecountry,” he said and that all IMF conditions were dully fulfilled.
He informed the media that on July 3, 2019 IMF Board of Directors’ meetingwould be held and all details would be dully published which would make thethings clear about the deal with the world credit body.
