Financial Times

Central Bank denies printing money
The Central Bank has denied it was resorting to 'inflationary financing', or in lay parlance, 'printing excess money', to increase liquidity in an artificial manner.

Central Bank authorities told The Sunday Times FT that the reserve money or the high-powered money put into the market is currently at Rs. 154 billion, which is slightly above target, and that economic volatility would be restrained with the economic policy of the government being unveiled.

While denying that the money supply has been inflated right now, Central Bank authorities said that it does intervene at times just like injecting a lubricant to the market.

However, market watchers speculated that there may have been an addition to the money supply to create more demand on the rupee and to restrain exchange rate volatility.

They said that this speculation can be substantiated and the quantum of the money printed identified once the regulator releases its growth data for the first quarter.

Back to Business