Yaseen Anwar formally appointed SBP governor

Tough days ahead for new central bank chief and is see as susceptible to government pressure.

KARACHI: Yaseen Anwar has formally been appointed as Governor State Bank of Pakistan according to a notification issued today and may be the chosen one by the authorities, but analysts and former government officials fear he may not be the best central bank governor to fight the challenges faced by the fragile economy.

The soft-spoken former banker has served as deputy governor of the State Bank of Pakistan since March 2007 and is seen by some as vulnerable to government pressures, especially after the recent aggressive and unexpected rate cuts.

Since July, the key policy rate has been slashed by 200 basis points to 12%, leaving analysts puzzled and concerned that the move, which the bank said was aimed at spurring growth, may end up widening the deficit and spurring inflation in the country.

The cuts have also led some analysts to question the bank’s independence, as the main beneficiary of lower rates would be President Asif Zardari’s cash-strapped government which would benefit immensely from fiscal relief to help serve its debt.

Anwar, a dual national who holds a US citizenship, studied economics and political science at the Wharton School of Business in Pennsylvania. He has about 33 years of banking experience across cities such as New York, London and Paris.

Published in The Express Tribune, October 20^th, 2011.