(Bloomberg) -- Pakistan may have to raise interest rates, Finance Minister Miftah Ismail said hours before a monetary policy review as it battles Asia’s second-fastest inflation.

The nation can’t afford to raise fuel costs and will try and convince the International Monetary Fund to offer financing without ending subsidies on gasoline and diesel, Ismail told reporters in Karachi on Monday. Ismail is leading negotiations for an IMF bailout.

“I will sign the agreement with the IMF in next two days and won’t come back without doing it,” Ismail said.

Pakistan’s dollar bonds and currency are trading at a record low as a shortage of dollars threatens to spill into a fullblown economic crisis without IMF funding. Ousted premier Imran Khan also plans to hold a sit-in at Islamabad starting May 25 to force early elections. 

 

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