Reserves hit $16.6b on ADB inflows

Pakistan's total liquid foreign reserves reached $16.6 billion as of November 29, 2024, according to the State Bank of Pakistan (SBP). These reserves include $12 billion held by the SBP and $4.6 billion held by commercial banks. The SBP reserves increased by $620 million during the week, primarily due to an official inflow of $500 million from the Asian Development Bank (ADB).

Additionally, the Saudi Fund for Development (SFD) extended the term for a $3 billion deposit maturing on December 5, 2024, by another year. This extension underscores Saudi Arabia's continued support for Pakistan, contributing to strengthened foreign exchange reserves and economic stability. Initially signed in 2021, the agreement has been rolled over annually since 2022, reflecting the strong relationship between the two nations.

In the currency market, the Pakistani rupee remained largely stable against the US dollar on Thursday, recording a minor depreciation of 0.01% in the interbank market. By the end of the session, the rupee stood at Rs277.94, slightly lower by Rs0.02 compared to Wednesday's rate of Rs277.92, as per SBP data. In the open market, the rupee traded at Rs277.16, reflecting a marginal increase of Rs0.09 from the previous day's rate.

Experts highlighted that Pakistan's economic indicators are showing signs of improvement. A reduced trade deficit, declining inflation, and growing political stability have fostered optimism among investors. Zafar Paracha of the Exchange Companies Association of Pakistan (ECAP) described the recent rupee depreciation as routine,underscoring its stable trajectory. Despite disruptions in November, investor confidence in the government's economic management is strengthening, contributing to a gradual upward trend in the rupee.

Meanwhile, gold prices in Pakistan recorded an increase on Thursday, in line with a rise in international rates, after remaining stable during the previous session. In the local market, the price of gold per tola climbed by Rs500, reaching Rs275,700, while the price for 10 grams rose by Rs428, settling at Rs236,368, according to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA).

On Wednesday, gold prices had remained unchanged across the country. Internationally, gold prices also experienced an uptick on Thursday, with the APGJSA reporting the global rate at $2,645 per ounce, reflecting a $5 increase. Spot gold remained steady at $2,649.69 per ounce, while US gold futures eased 0.1% to $2,673.30. Market activity remained cautious as investors awaited US non-farm payroll data and the Fed's meeting.