SBP repays $1.3b in external debt

Total forex reserves stand at $21.5b; gold drops amid US-Iran tensions

KARACHI:

The State Bank of Pakistan's (SBP) foreign exchange reserves decreased by $1.305 billion and reached $15.916 billion during the week ended June 19, 2026. The decline was mainly due to external debt repayments.

In the following days, however, the government received fresh inflows that are expected to significantly strengthen the central bank's reserves position. The SBP has received $0.7 billion from a multilateral institution and approximately $1.7 billion as refinancing of a government commercial loan. "These inflows will be reflected in the SBP's foreign exchange reserves as on June 30, 2026," said the central bank in a statement on Monday.

Pakistan's total liquid foreign reserves stood at $21.485 billion as of June 19, 2026. Of these, the foreign reserves held by the State Bank were $15.916 billion, while the net foreign reserves with commercial banks stood at $5.568 billion.

Furthermore, the Pakistani rupee appreciated 0.01% against the US dollar, closing at Rs278.17 on Monday compared to Rs278.20 on Wednesday last week.

Meanwhile, gold prices in Pakistan declined, tracking losses in the international market as fresh US-Iran tensions boosted oil prices and stoked inflation fears, raising expectations of higher interest rates.

In the local market, the price of gold per tola stood at Rs428,936 after a drop of Rs2,300, according to rates shared by the All-Pakistan Gems and Jewellers Sarafa Association. Similarly, the 10-gram gold was sold for Rs367,743 after falling by Rs1,972. The price of silver decreased by Rs69 to Rs6,324 per tola. On Saturday, the per-tola gold had closed at Rs431,236 following a decline of Rs1,000.

Internationally, spot gold slid 1.5% to $4,025.83 per ounce by midday ET, after dipping more than 2% earlier and hitting a more than seven-month low last week, according to Reuters. US gold futures for August delivery fell 1.4% to $4,040.70.

Interactive Commodities Director Adnan Agar noted that gold prices came under pressure. "The low was $4,000, the high was $4,090 and the market closed at $4,024. Right now, gold prices are under pressure," he said. Agar suggested that the market could test lows around $3,600 to $3,900 in the coming days before any potential upside. He highlighted the linkage with oil. "If oil goes up from here, which has a very high chance, then the stories of a gold reversal will start again."

With US-Iran issues persisting, including Iran's strikes on US military sites in Bahrain and Kuwait on Sunday, "gold is expected to remain under pressure for one to two months", he said.

Market participants are also eyeing key US data this week, including the ADP employment report and non-farm payroll figures, which could further influence rate expectations and the dollar's strength.