Pakistan’s reserves plunge 43-month low to $13.56 billion

Pakistan’s reserves plunge 43-month low to $13.56 billion

KARACHI: Pakistan’s foreign exchange reserves have declined 43-month low at $13.56 billion by week ended August 05, 2022.

The foreign exchange reserves of country fell by $648 million as those were $14.21 billion a week ago i.e. July 29, 2022, the State Bank of Pakistan (SBP) said on Thursday.

READ MORE: Pakistan’s foreign reserves dip to $14.21 billion

Pakistan’s foreign exchange reserves were seen at $13.597 billion on January 2019.

The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $13.668 billion.

The official reserves of the State Bank also fell by $556 million to $7.83 billion by week ended August 5, 2022 as compared with $8.386 billion a week ago.

READ MORE: Pakistan forex reserves deplete to $14.42 billion

The SBP attributed the decline in foreign exchange reserves to external debt repayments.

It is pertinent to mention that the SBP received about $2.3 billion from Chinese banks for buildup of foreign exchange reserves. However, despite receiving the amount the external debt payment kept the pressure on the reserves.

Further, the country is in negotiation with the IMF for release of next tranche under Extended Fund Facility (EFF) to boost its foreign exchange reserves.

READ MORE: Pakistan’s forex reserves decline to $15.24 billion

The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021. Since then the official reserves of the SBP declined by $12.316 billion.

The commercial banks held foreign exchange witnessed a decline of $92 million to $5.731 billion by week ended August 05, 2022 when compared with $5.82 billion a week ago.

READ MORE: Pakistan’s forex reserves drop to $15.61 billion

The sharp decline in foreign exchange reserves has resulted in free-fall of rupee value.

The local currency ended historic low of Rs239.94 to the dollar at closing of interbank foreign exchange market on July 28, 2022. However, on the hope of inflows from the IMF and improved indicators the rupee rebounded in the month of August 2022.

READ MORE: Pakistan’s forex reserves deplete to $15.74 billion

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