SBP governor briefs PAC: Inflation to drop in coming days

ISLAMABAD: Governor State Bank of Pakistan (SBP) Reza Baqir foresees a downward trend in inflation in the coming days saying the recent rise in inflation is temporary due to supply disruptions and rupee devaluation.

Briefing the Public Accounts Committee (PAC) on the central bank’s monetary policy, he said the Large Manufacturing Sector had witnessed growth and increase in domestic consumption of cement.

Acting Chairperson FBR Nausheen Javed also attended the meeting.

Baqir told the committee that the SBP’s main task was to protect the foreign exchange reserves which had registered an increase.

He said increase in foreign exchange reserves promised an improved economy.

“Economy was not stable some time back but with stability in the exchange rate, it is moving towards stability,” he told the committee.

PAC member Khawaja Asif asked for disclosing the names of the foreign investors, who had invested hot money and also those benefited from it.

Baqir said there was a misperception about the hot money, as it came into Pakistan several times in the past and it was not a new phenomenon. He said hot money was manageable and not risky.

Responding to Senator Mushahid Hussain Sayed’s question about the impact of coronavirus on the country’s economy, Baqir said the US import orders from China could not be fulfilled that would benefit the Pakistani exporters.

To a question by Senator Sherry Rehman with regard to the capital control and the IMF interference in the government policies, he said the IMF was not against the capital control.