Pakistan's economy is showing signs of recovery but risks remain, the IMF said last week. The Fund, which was reviewing the country's progress with Pakistani officials in the United Arab Emirates, said discussions would be completed shortly as Pakistan looks to keep funds flowing from its USD 11.3 billion aid deal. IMF officials have some reason for optimism. "While risks to the economic outlook remain, the early signs of recovery in some sectors, declining inflation and the improved external position are encouraging," the IMF said in a statement. IMF Mission Chief Andreas Bauer said the economy should expand by 2 percent in 2010 after shrinking by 1.5 percent in 2009. Annual inflation is on track to decline to 5 percent by the end of this year, and to stay within the central bank's target of 4 to 6 percent in 2010. (Reuters, Dow Jones)

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