IMF likely to relax terms

SBP denies dollar supply to interbank market to support rupee

KARACHI:

The State Bank of Pakistan (SBP) has expressed hope that the International Monetary Fund (IMF) will consider the economic hardships being faced by Pakistan in the wake of floods and soften its conditions, as the country is expected to receive $4 billion from multilateral creditors over the next couple of months.

Besides, Pakistan has made foreign debt repayment of $4.6 billion so far in the current fiscal year. It, however, denied that it was supplying dollars to the inter-bank market to support the rupee, which recovered 9% (or Rs21.74) over the past 12 consecutive working days and stood at Rs217.97 to a dollar on Monday. Analysts quoted the newly appointed SBP Governor Jameel Ahmed as having made the assertion at an analyst briefing on the monetary policy.

The SBP said that the IMF programme was on track and the central bank had fully complied with the (endSeptember 2022) targets and “is hopeful about a positive outcome with reconsideration of the conditions postfloods in the next review,” Arif Habib Limited economist Sana Tawfik said in a commentary after attending the analyst briefing. In the wake of floods, according to the SBP, Pakistan has received additional commitments of $4 billion with inflows expected between October and December 2022.

“The World Bank’s commitment depends on implementing a few conditions,” she cited the SBP chief as saying. The SBP governor reiterated that the government would not seek to defer debt payment to the international lenders and would make the due payments. So far, “$4.6 billion has been repaid to the external lenders in the current fiscal year.” The rupee on Monday maintained its uptrend for the 12th successive working day as it gained 0.89% (or Rs1.95) to close at a new one-month high at Rs217.97 against the greenback in the inter-bank market.