Karachi, August 24, 2023 – The State Bank of Pakistan (SBP) reported a significant decrease in Pakistan’s foreign exchange reserves, citing a decline of $131 million for the week ending August 18, 2023.
This announcement was made on Thursday, adding to concerns about the country’s economic stability.
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According to the SBP, the foreign exchange reserves dropped to $13.248 billion by the week ending August 18, 2023, in contrast to the figure of $13.379 billion recorded for the week ending August 11, 2023.
It’s crucial to note that while the current level of foreign exchange reserves exhibits a decline, it remains significantly lower than the peak observed in August 2021 when the reserves stood at a robust $27.2 billion. This sharp contrast underscores the ongoing challenges faced in maintaining a secure economic foundation.
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Furthermore, the official foreign exchange reserves held by the SBP also experienced a decline of $125 million, reaching $7.93 billion by the week ending August 18, 2023. This is compared to the figure of $8.055 billion recorded just one week prior.
The dwindling foreign exchange reserves raise concerns about the potential pressure on the exchange rate. The Pakistani Rupee (PKR) recently hit a historic low of PKR 300.22 against the US dollar on August 24, 2023, at the closing of the Interbank foreign exchange market.
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The combination of a depreciating currency and declining foreign exchange reserves poses significant challenges for Pakistan’s economic stability. It emphasizes the urgent need for measures to bolster the country’s foreign exchange reserves and stabilize the national currency. Authorities and financial stakeholders will continue to closely monitor the situation and seek solutions to address these economic challenges.
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