Karachi, February 20, 2025 – Pakistan’s total foreign exchange (forex reserves) have witnessed an increase of $85 million, as per the latest data released by the State Bank of Pakistan (SBP) on Thursday.
This rise in forex reserves reflects improved foreign inflows, which are crucial for maintaining economic stability.
The net forex reserves of the country surged to $15.948 billion for the week ending February 14, 2025, compared to $15.863 billion recorded by the end of the previous week on February 7, 2025. The SBP’s forex reserves alone saw an increase of $35 million, reaching $11.202 billion by February 14, 2025, up from $11.167 billion a week earlier.
Similarly, commercial banks also experienced an improvement in their forex reserves, with a rise of $50 million. The reserves held by commercial banks climbed to $4.746 billion by the week ending February 14, 2025, compared to $4.696 billion in the prior week.
Despite this marginal improvement, Pakistan’s forex reserves remain at relatively low levels, a concern that has persisted over the past several years. The government is making concerted efforts to enhance foreign inflows to strengthen the external sector and ensure macroeconomic stability. Authorities are focusing on securing foreign investments, increasing remittances, and negotiating favorable trade deals to bolster forex reserves in the long run.
Economists emphasize that while the recent increase in forex reserves is a positive sign, sustainable growth in foreign exchange holdings will depend on continued policy reforms and effective management of external financial obligations. Stability in forex reserves is essential for maintaining investor confidence, controlling inflation, and ensuring smooth international trade operations.
Analysts also point out that the improvement in forex reserves can help stabilize the exchange rate, reducing pressure on the local currency. A stronger reserve position enables the country to meet its external debt obligations and finance essential imports such as fuel, machinery, and raw materials. However, they caution that external risks, including global economic uncertainties and fluctuations in oil prices, could impact future forex reserves trends.
The government has been actively working on diversifying its sources of foreign exchange earnings by promoting exports, attracting foreign direct investment, and seeking financial assistance from international lenders. Strengthening forex reserves remains a top priority to ensure long-term economic resilience and reduce dependency on external borrowing.