KARACHI: Pakistan’s liquid foreign exchange reserves recorded a modest uptick, reaching $24.668 billion by the week ending August 13, 2021, according to the latest data released by the State Bank of Pakistan (SBP) on Friday.
This marks an increase of $24 million compared to the previous week’s level of $24.644 billion reported on August 6, 2021.
The central bank noted that the rise in the overall foreign exchange reserves was primarily attributed to a marginal gain in the balances held by commercial banks. While the State Bank’s own official reserves remained largely unchanged, standing at $17.626 billion by the week ending August 13—only slightly above the previous week’s $17.623 billion—commercial banks saw a moderate increase in their holdings.
Reserves maintained by commercial banks increased by $21 million, bringing their total up to $7.042 billion, compared to $7.021 billion a week earlier, the State Bank of Pakistan said. This slight improvement in the private sector’s foreign exchange reserves reflects stable inflows and limited volatility in the domestic currency market, the State Bank of Pakistan added.
The country’s total foreign reserves have remained relatively steady in recent weeks, buoyed by stable remittances and cautious foreign exchange management by the State Bank of Pakistan. Analysts believe that maintaining strong foreign exchange buffers is vital for shielding the economy against external shocks and maintaining investor confidence.
The State Bank of Pakistan has been closely monitoring the external account and managing exchange rate pressures to ensure that the reserves remain at a healthy level. While the current rise is modest, it underscores the importance of ongoing efforts to attract foreign investment, manage imports prudently, and encourage exports to further strengthen the nation’s foreign exchange reserves.
Maintaining a robust level of foreign exchange reserves is crucial for stabilizing the rupee, meeting external debt obligations, and supporting overall macroeconomic stability in the face of global economic uncertainties.