Earlier this year the Central Bank said it would target reserve money growth in 2010 at 14.5 percent in a bid to maintain inflation at around 5 to 6 percent and economic growth of around 7 percent.

The original reserve money target for the year was Rs. 315.5 billion on average with quarterly targets of Rs. 306.5 billion for March, Rs. 314.9 for June, Rs. 313.9 for September and Rs. 326.9 for December.

According to the revision, the third quarter target has been moved up to Rs. 335.8 billion and the fourth quarter is moved up to Rs. 350.3 billion, for an annual average of Rs. 334 billion, or 21.2 percent growth.

In 2009, the reserve money target was Rs. 288.1 billion, a growth of 2.8 percent, but the actual was Rs. 275.6 billion, a 0.7 percent decline, as the rate of inflation dipped to levels that were lower than expected with tight monetary policy.

According to the mini budget for 2010, domestic financing of the 8 percent of GDP budget deficit is estimated at Rs. 315.3 billion, a 19.66 percent decline from Rs. 392.5 billion last year.

From January to April this year, domestic financing the deficit amounted to Rs. 125.1 billion, down 36.8 percent from Rs. 198.1 billion during the corresponding period of 2009.

In April, net credit to the private sector grew by 1.7 percent to Rs. 1,242.7 billion from Rs. 1,222.3 billion a year ago, a stronger year-on-year growth than in March which was a marginal 0.1 percent.

The bulk of this credit is from the domestic banking unit, which increased its lending in April by 2.5 percent to Rs. 1,093.7 billion from Rs. 1, 067.5 percent a year earlier. In March, it recorded 0.5 percent growth.

Credit from foreign sources declined 3.8 percent from Rs. 154.8 billion in April 2009 to Rs. 149 billion.