Foreign exchange: SBP reserves surge past $16-billion mark

Increase comes on back of proceeds received from Eurobonds issuance

KARACHI:

The State Bank of Pakistan's (SBP) foreign currency reserves rose above $16 billion after the central bank received $2.5 billion as proceeds of Eurobonds floated by the government.

Pakistan had borrowed $2.5 billion through Eurobonds on March 30 by offering very lucrative interest rates to lenders aimed at building foreign exchange reserves.

Earlier in the day, the SBP reported that its foreign exchange reserves fell 1.06% on a weekly basis.

On April 2, the foreign currency reserves held by the SBP were recorded at $13,527.2 million, down $146 million compared with $13,673 million in the previous week. According to the central bank, the fall came on the back of external debt repayments.

Overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $20,679.4 million. Net reserves held by banks amounted to $7,152.2 million.

Pakistan received the first loan tranche of $991.4 million from the International Monetary Fund (IMF) on July 9, 2019, which helped bolster the reserves. In late December 2019, the IMF released the second loan tranche of around $454 million.

The reserves also jumped on account of $2.5 billion in inflows from China. In 2020, the SBP successfully made foreign debt repayment of over $1 billion on the maturity of Sukuk.

In December 2019, the foreign exchange reserves surpassed the $10 billion mark owing to inflows from multilateral lenders including $1.3 billion from the Asian Development Bank (ADB).