Foreign Exchange: Reserves rise to $16.39 billion

Without additional sources of revenue, loan repayments will further drain Pakistan’s reserves.

KARACHI: Foreign exchange reserves rose to $16.39 billion in the week ended March 9, compared with $16.34 billion in the previous week, because of an increase in reserves held by commercial banks, the central bank said on Thursday. Reserves held by the State Bank of Pakistan (SBP) fell to $11.86 billion from $11.90 billion a week earlier, while those held by commercial banks rose to $4.53 billion, compared with $4.44 billion the previous week. A record inflow of remittances has helped support Pakistan’s reserves. In February, overseas Pakistanis sent back $1.16 billion. But reserves have since been drained by debt repayments, including $399 million in the week ending February 24 on a $8 billion International Monetary Fund loan. Without additional sources of revenue, repayments will further drain Pakistan’s reserves.

Published in The Express Tribune, March 16^th, 2012.