ISLAMABAD - Finance Minister Ishaq Dar on Saturday expressed satisfaction on 0.5 per cent reduction in policy rate by the State Bank of Pakistan for next two months.

The finance minister said the decision reflects stability in the economy, which has been achieved through a consistent economic reforms process undertaken by the government under the leadership of Prime Minister Muhammad Nawaz Sharif.

The minister further said that record low inflation of less than 2 per cent in the months of July and August 2015 facilitated reduction in policy rate. Following the steep decline in inflation rate, the central bank had brought down the policy rate to 6 percent.

“Lower policy rate would trigger a new wave of enhanced economic activity in the country”, said Ishaq Dar.

The minister, on this occasion, reiterated his resolve to achieve the target of $21 billion forex reserves within this year. He said the Ministry of Finance was making all out efforts to realize this objective. Pakistan’s current foreign exchange reserves stood at $18.598 billion wherein central bank’s reserves are $13.6 billion and other commercial banks’ $5.04 billion.

In another development, the newly appointed German Ambassador to Pakistan, Ms Ina Lepel met the Finance Minister Ishaq Dar here Saturday. First Secretary, Almut Knop on the occasion, accompanied her.

Dar welcomed the German Ambassador and wished her well during her diplomatic assignment in Pakistan. The Ambassador apprised the minister of the visit next week to Pakistan by the German Deputy Minister of Economic Cooperation and sought his meeting with the Finance Minister.

The finance minister welcomed the visit and said he looked forward to meeting the visiting German dignitary on Wednesday to discuss matters relating to bilateral economic cooperation and take decisions. The minister shared with the German envoy Pakistan’s efforts for rehabilitation of TDPs. He said that support from donors and development partners for rehabilitation was highly welcomed. He said a special oversight and coordination cell has been established in the Economic Affairs Division to streamline all such activities.

There was also discussion on Pak-German Secretary level talks on economic cooperation to be held in Berlin by the end of October this year. The minister on this occasion appreciated continued German cooperation and assistance for development projects in Pakistan.