Net federal government borrowings from the central bank for budgetary support from July 1 to October 10 amounted to Rs107.4 billion, latest monetary aggregates released by the State Bank of Pakistan (SBP) show.
They amounted to Rs539.5 billion over the same period of the last fiscal year, which reflects a year-on-year decline of 80% in net federal government borrowings from the SBP for budgetary support.
The drastic reduction in the federal government’s borrowings from the central bank has resulted in contraction of money supply in the economy since the beginning of the fiscal year, SBP data shows.
Broad money – which includes currency as well as deposits with the SBP – contracted by Rs9.5 billion during July 1 and October 10. This translates into a negative growth of 0.1% in money supply. In contrast, money supply had increased Rs29.2 billion, or 0.33%, over the same period during the preceding fiscal year.
Data shows the currency in circulation has increased by Rs266.3 billion since the start of the current fiscal year. Increase in the currency in circulation during the same period of the last fiscal year was Rs184.3 billion.
Total currency in circulation on October 10 stood at Rs2.4 trillion, SBP monetary aggregates show.
