FX drops $1.3b on Eurobond payment

Experts say Saudi deposits will bolster forex holdings and help meet IMF-linked targets

KARACHI:

Pakistan's foreign exchange reserves held by the central bank decreased $1.321 billion during the week ended April 10, 2026 as the country repaid $1.426 billion to investors following maturity of Eurobonds in the international market.

According to data released by the State Bank of Pakistan (SBP) on Thursday, Pakistan's total liquid foreign currency reserves reached $20.524 billion, comprising $15.079 billion with the SBP and $5.445 billion with commercial banks.

A week ago, the State Bank's reserves had increased by $19 million to $16.40 billion, which took total foreign currency deposits to $21.895 billion.

The central bank also announced that it had received $2 billion in funding from the Ministry of Finance, provided by Saudi Arabia. This financing, which came immediately after Pakistan decided to repay $3.5 billion to the United Arab Emirates (UAE), is expected to reflect in next week's foreign reserves data and bolster Pakistan's external buffers.

Commenting on the Saudi assistance, economic policy think tank PRIME founder Dr Ali Salman told The Express Tribune that the $2 billion inflow came at a critical juncture for Pakistan, propping up foreign exchange reserves and helping meet the International Monetary Fund (IMF)-linked reserve targets such as three-month import cover.

It would also cushion the impact of anticipated import pressure amid rising global crude oil prices ahead of the federal budget, effectively buying short-term stability, he said.

However, Salman cautioned that as a liability-creating inflow, it underscores the growing external dependence and may carry geopolitical sensitivities, particularly given Pakistan's delicate balancing role in regional conflict.

Topline Research CEO Mohammed Sohail commented that the fresh $2 billion Saudi deposits would help in repaying the UAE debt without any major impact on Pakistan's currency and forex reserves.

Earlier, reports said that Pakistan had decided to return a $3.5 billion debt of the UAE in April, according to a senior cabinet minister, ending speculation about the fate of the debt.

In its report, Topline said though the reserves held by the SBP went down by $1.3 billion to $15.1 billion for the week ended April 10, 2026, it expected the SBP holdings to reach $17.4 billion in June.

Meanwhile, the Pakistani rupee on Thursday edged up one paisa to settle at Rs278.95 against the US dollar in inter-bank dealings. Additionally, according to the SBP, the Real Effective Exchange Rate (REER) index appreciated to 105.2 in March 2026 as compared to 103.1 in February.

In the domestic precious metals market, 24-karat gold prices rose Rs1,400 to close at Rs504,862 per tola, taking cue from the international market, where bullion reached $4,825 per ounce, following an increase of $14.

The rate for 10 grams of gold increased by Rs1,200 and settled at Rs432,837. Silver prices too gained ground, closing at Rs8,514 per tola with the addition of Rs110.