Forex reserves fall by $74m to $4.4b

SBP cites external debt repayment as reason for decrease

KARACHI:

The foreign exchange reserves held by the central bank fell by 1.7% on a week-on-week basis to $4.4 billion, according to data released by the State Bank of Pakistan (SBP) on Thursday.

On May 5, 2023, the SBP’s foreign currency reserves stood at $4,383.4 million, down by $74 million as compared to $4,457.2 million on April 28. The central bank attributed the decrease in foreign exchange reserves to external debt repayment.

Overall, the liquid foreign currency reserves held by the country, including the net reserves held by banks other than the SBP, stood at $9,990.4 million. The net reserves held by banks amounted to $5,607 million.

Ismail Iqbal Securities Head of Research Fahad Rauf has said that any significant improvement in Pakistan’s foreign currency reserves depends on the revival of International Monetary Fund’s (IMF) loan programme and inflow of fresh financing from other multilateral and bilateral creditors.

“They (FX reserves) are projected to rise to around $7-8 billion by the end of current fiscal year on June 30, 2023,” he said.

Published in The Express Tribune, May 12^th, 2023.

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