Staff Reporter Governor of State Bank of Pakistan (SBP) Reza Baqir has said that economic situation is improving and things are getting better due to reforms. Addressing English Speaking Union on Monday, the governor said that State Bank wants to reduce the use of circulatory currency notes.He said that monetary policy committee raised interest rates as inflation is likely to rise in the future. Reza Baqir said that in last year foreign exchange reserves were at $7 billion while immediate payments were $8 billion. He also informed the participants that now exchange rate is market based and no one can predict exchange rate of any country. The more foreign exchange reserves a country has, the more independent it will be.The Governor SBP said that Pakistan approached IMF because of falling foreign exchange reserves, which provide economic independence. He also said that monetary policy committee increased the basic interest rate as inflation is likely to increase in the future. The SBP governor said potential criticism of the current account improvement is the claim that this improvement has come about by slowing down the economy and is largely driven by import compression without growth in exports. This is not entirely correct.
