Foreign exchange: SBP reserves fall $223m to $17.6b

The foreign exchange reserves held by the central bank fell 1.25% on a weekly basis, according to data released by the State Bank of Pakistan (SBP) on Thursday.

On August 6, the foreign currency reserves held by the SBP, after accounting for other official inflows, were recorded at $17,622.7 million, down $223 million compared with $17,846 million recorded on July 30.

According to the central bank, the fall came on the back of the State Bank of Pakistan’s external debt repayments and payments for the import of Covid-19 vaccines that amounted to $245 million, and other official payments.

Overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $24,644 million. Net reserves held by banks amounted to $7,021.3 million.

Earlier, Pakistan borrowed $2.5 billion through Eurobonds on March 30, 2021 by offering lucrative interest rates to lenders aimed at building the foreign exchange reserves.

It 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).