M2 registers 3.0 percent growth during July-November

The broad monetary aggregate (M2) registered a growth of 3.0 percent during July-November FY07 period, which was the same as achieved during the corresponding period of FY06.
The State Bank of Pakistan (SBP) in its first quarterly report issued here on Thursday said that as in the previous year, the expansion in money supply during July-November FY07 has been entirely contributed by the increase in net domestic assets (NDAs) of the banking system as the net foreign assets (NFAs) showed a contraction during the period, reflecting the continued pressures on country's external account.
The SBP is targeting to contain FY07 M2 growth at 13.5 percent against the actual growth of 15.2 percent in the preceding year. The acceleration in M2 during July-November FY07 is quite unwelcome and reinforced the need for a tight monetary stance.