By Muskan Naveed ISLAMABAD, Feb. 08 (INP-WealthPK): The State Bank of Pakistan hopes that an upward trend in remittances, the resumption of the Extended Fund Facility of the International Monetary Fund, the launch of the Sukuk Islamic bond, and curbs on rising imports will help avert the balance of payments crisis and bring down the current account deficit (CAD). It is pertinent to mention here that the CAD has grown to $9.092 billion during the first half of the fiscal year 2021-22. The CAD remained broadly unchanged in December 2021 compared with November, going slightly up to reach $1.93 billion from $1.89 in November, an increase of only 2%. The State Bank also expects the non-oil current account to show a minor uptick in the coming months. The upward trend in workers’ remittances is a positive sign for the balance of payments, as in December 2021, remittances stood at $2.5 billion with an increase of 2.5% from November 2021. The cumulative remittances recorded an increase of 11.3% during the July-December half of the current fiscal year over the same period of FY2020-21. Though imports witnessed a surge in November 2021 due to an uptick in domestic demand, December saw a decline by 2.95%. However, exports suffered a decline of 4.69%. The overall trade deficit declined by 1.94% in December 2021 over November 2021. The year-on-year data shows an increase of 66% in imports and around 25% increase in exports. Imports of energy products and Covid-19 vaccines were largely responsible for the increase in overall imports. Meanwhile, textiles and rice exports saw a boost. The last meeting of the Monetary Policy Committee of the State Bank kept the policy rate unchanged at 9.75%, indicating that there was no major threat to the economy from both external and internal sources. Meanwhile, the total domestic demand for the fiscal year 2021-22 is expected to grow by 6.8%, as the economies worldwide recover from the effects of the Covid-19 pandemic. Consumption is expected to contribute 93.9% of the demand and achieve a growth of 6.9%. The consolidated monetary and fiscal policies are expected to control the inflation as the SBP reported a decline in the month-on-month inflation in December. Macroeconomic indicators can be expected to stabilise in the coming months and a moderate growth rate of 4-5% is estimated for the country. Inflation is also predicted to stabilise in the range of 5.7% during the next year. Growth in fiscal deficit is also reported to have declined which suggests economic stability. In the first quarter of 2021, the total revenue stood at Rs1,479 billion against expenditures of Rs1,963 billion. The budget balance had been Rs484 billion and the deficit accounted for 1.1% of the Gross Domestic Product. On the other hand, in the first quarter of 2021-22, the revenue generation amounted to Rs1,809 against expenditures of Rs2,247 billion with a budget deficit of Rs438 billion. During this period, the fiscal deficit as a percentage of GDP declined from 1.1% to just 0.8%.