On July 24, short term money rates eased, amid increased inflows. In the 2-day repo, the central bank rejected all bids for Treasury Bills. Overnight call rates ended at seven down from 11.5 per cent a day earlier. The market remained fairly liquid.

On July 25, the State Bank of Pakistan mopped up Rs15.15 billion from the market, pushing the overnight rate up to 10.5 per cent.

Despite State Bank’s tight monetary policy there was excess liquidity in the market which had brought down the overnight rate to seven per cent.

The SBP sold Rs15.15 billion of T-bills under 3-day repo at 9.85 per cent. More OMOs are expected in the coming days to clean the market from excess liquidity.

According to the weekly statement of position of all scheduled banks for the week ended July 19, 2008, deposits and other accounts of the scheduled banks stood at Rs3,783.937 billion, smaller by Rs17.966 billion over preceding week’s figure of

Rs3,801.903 billion. Commercial banks deposits showed a decline of Rs17.826 billion over the week to Rs3,771.712 billion, against preceding week’s Rs3,789.538 billion. Specialised banks deposits stood at Rs12.225 billion, against preceding week’s Rs12.365 billion, a fall of Rs0.14 billion.

Borrowings by all scheduled banks increased further during the week over preceding week’s figure. It rose to Rs363.284 billion over preceding week’s figure of Rs355.926 billion, a rise of Rs7.358 billion.

This was due to a rise in the borrowings by commercial banks, which rose to Rs282.018 billion against previous week’s Rs274.330 billion, or by Rs7.688 billion.

Borrowings by specialized banks stood at Rs81.266 billion, against preceding week’s figure of Rs81.596 billion.

Gross advances stood at Rs2,853.211 billion in the week under review, an increase of Rs3.358 billion over preceding week’s figure of Rs2,849.853 billion. Advances by commercial banks rose to Rs2,754.757 billion against earlier week’s figure of Rs2,751.732 billion, or by Rs3.025 billion.

Advances of specialised banks stood at Rs98.454 billion, larger by Rs0.333 billion over earlier week’s figure of Rs98.121 billion.

Investments of all scheduled banks decreased in the week by Rs15.331 billion to Rs1,054.403 billion against preceding week’s figure of Rs1,069.734 billion. Commercial banks investment fell to Rs1,040.695 billion, from earlier week’s Rs1,055.711 billion, or by Rs15.016 billion. Specialised banks investment stood at Rs13.708 billion, against preceding week’s Rs14.023 billion, lower by Rs0.315 billion.

Cash and balances with treasury banks of all scheduled banks increased by Rs0.594 billion during the week to stand at Rs439.339 billion against earlier week’s Rs438.745 billion.

The figure for commercial banks stood at Rs436.399 billion against preceding week’s figure of Rs435.475 billion, a rise of Rs0.924 billion, while of specialized banks it stood at Rs2.940 billion over previous week’s Rs3.270 billion.

Total assets of scheduled banks stood at Rs5,005.448 billion, lower by Rs1.639 billion, over preceding week’s figure of Rs5,007.3087 billion.

Meanwhile, commercial banks assets stood at Rs4,884.060 billion, lower by Rs2.767 billion over previous week’s figure of Rs4,886.827 billion.

Specialised banks assets fell to Rs121.388 billion, or by Rs1.129 billion over previous week’s Rs120.259 billion.