(Bloomberg) -- Pakistan central bank deputy governor Murtaza Syed will act as interim chief of State Bank of Pakistan until a new governor is announced.
“As the term of Governor SBP Dr Reza Baqir has come to an end, as per law the senior most Deputy Governor takes over until,” Finance Minister Miftah Ismail said in a Twitter post Wednesday. Reza Baqir's three-year term expired May 4.
Syed takes the job ahead of an interest-rate review due May 23 even as the key borrowing cost has been raised by 525 basis points from its pandemic-era low to 12.25%. He will also be tasked with setting the course of the policy to fight Asia's second-fastest inflation as well as win the confidence of the International Monetary Fund as it examines releasing the remainder of a $6 billion loan.
PAKISTAN REACT: More Hikes Likely as Price Pressures Intensify
Talks with the lender are due to start this month over conditions for accessing the $3 billion balance, which may include doing away with subsidies on fuel and electricity. That could further stoke inflationary pressures and add to the challenge of the central bank trying to cool double-digit price-growth.
Pakistan has seen its foreign exchange reserves decline to less than two months of import cover. It faces a falling currency and a rising current account deficit. The South Asian nation is also resorting to long power cuts as electricity plants face fuel and funding shortages.
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