Islamabad: The International Monetary Fund (IMF) has asked the government to further strengthen and secure the independence of the State Bank.
The IMF has released a report on Pakistan, which says that Pakistan needs to make its monetary policy more rigorous, proactive and data-driven, while the recent hike in interest rates is welcome.
The report said that tightening should continue if needed to reduce inflation and ease external balances, strengthening the monetary policy process by implementing a plan to phase out refinancing schemes. There will be transparency in these schemes.
The IMF said in the report that the most important thing is that the independence of the State Bank of Pakistan should be strengthened and protected while the exchange rate should be determined on a market basis, absorb external shocks, maintain competitiveness. There is a need to promote remittances by providing incentives to help maintain, and rebuild international foreign exchange reserves.
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