SBP’s forex reserves fall to 8-year low at $6.1 billion

Central bank cites external debt repayment as reason for decrease in reserves

KARACHI:

In its latest weekly update on Thursday, Pakistan's central bank reported the country's foreign exchange reserves have depleted to $6.11 billion.

"During the week ended on December 16, 2022, SBP's reserves decreased by $584 million to $6,116.2 million due to external debt repayment," SBP said in a statement.

The foreign exchange reserves held by the central bank fell by 8.7% on a week-on-week basis.

Overall, the liquid foreign currency reserves held by the country, including the net reserves held by banks other than the SBP, stood at $12,000.1 million. Net reserves held by banks amounted to $5,883.9 million.

Also read: Forex reserves fall by $14.9m at $6.7b

Local research houses said the reserves have hit lowest level since April 2014, meaning they have depleted to eight-year and nine-month low since then.

They are hardly enough to cover five weeks of import compared to minimum requirement for three months.

The country is facing an economic crisis with dollar shortage and a delay in resumption of loan programme with the International Monetary Fund.

Investors are still concerned about the nation’s ability to keep up on its foreign debt obligations, with long-term dollar bonds continuing to trade at distressed levels despite the payment of a $1 billion bond this month.