WASHINGTON - Pakistan's government has agreed that a shift in fiscal and monetary policy will be necessary to confront a deteriorating economic situation, the International Monetary Fund said Wednesday. In a statement following a 12-day visit to Islamabad and Dubai to meet with Pakistani officials, the IMF mission said the country is on track to comply with the economic programme agreed to under a $7.6 billion credit facility granted in November. But it said Pakistan's economy has been hurt by worsening global economic conditions. "The deterioration in the global economic environment and weaker economic activity call for an update of the economic framework and a recalibration of economic policies," the statement said. "In particular, discussions focused on the fiscal program and the monetary policy stance." To achieve fiscal targets for fiscal years 2009 and 2010, which end in June, there was agreement that additional revenue-boosting measures and spending cuts will be necessary, the IMF said. Meanwhile, the fund said that the current monetary policy stance is appropriate but that rates could be lowered in the future if both headline and core inflation decline, international reserves remain solid, and the government avoids resorting to central bank financing. In Dubai, Pakistan Finance Minister Shaukat Tarin told that the IMF had agreed to release the second payment of the programme, worth a little over $800 million.