Forex reserves dip by $15m; gold shines
Nearly 87% of foreign loans were for budget financing and building foreign exchange reserves, which meant that these had not been utilised for creating assets. PHOTO: FILE
The State Bank of Pakistan's (SBP) foreign exchange reserves fell by $15 million week-on-week, reaching $11.70 billion as of January 3, according to data released on Thursday. The country's total liquid foreign reserves stood at $16.38 billion, with commercial banks holding net reserves of $4.68 billion. While the central bank did not provide a specific reason for the drop, analysts speculate it may be related to foreign loan payments. "During the week ending on January 3, 2025, SBP reserves decreased by $15 million to $11.695 billion," the report stated.
Meanwhile, gold prices in Pakistan saw another increase on Thursday, reflecting a rise in international rates. In the local market, the price of gold per tola rose by Rs1,300, reaching Rs278,300. Similarly, the price of 10-gram gold climbed by Rs1,114, settling at Rs238,597, according to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA). On Wednesday, the price of gold per tola had increased by Rs1,000, reaching Rs277,000.
The international price of gold also saw an uptick on Thursday. According to APGJSA, the rate was quoted at $2,665 per ounce, with a premium of $20, marking an increase of $13 during the day.
Adnan Agar, Director of Interactive Commodities, said, "The United States observed a holiday on Thursday in remembrance of President Jimmy Carter, resulting in limited movement in the gold market as the US market is a key driver of global gold prices. With little activity on Thursday, all eyes are now on Friday's release of the US non-farm employment data, which is expected to significantly influence market trends and set a new direction."
Moreover, the Pakistani rupee also saw a slight gain against the US dollar, appreciating by 0.04% in the interbank market on Thursday. At the close, the currency stood at 278.61, gaining 11 paisa against the US dollar. On Wednesday, the rupee had settled at 278.72, according to the State Bank of Pakistan (SBP).
The US dollar strengthened globally on Thursday, supported by rising Treasury yields. This led to pressure on the yen, sterling, and euro, which dropped to multi-month lows amid the changing threat of tariffs.
Looking ahead to 2025, markets are closely watching the policies of US President-elect Donald Trump as he returns to the White House on January 20. Analysts anticipate that his policies will not only support economic growth but also contribute to higher price pressures.