Karachi, April 24, 2025 – The State Bank of Pakistan (SBP) reported a significant drop in its official foreign exchange (forex) reserves, with a decline of $367 million during the week ending April 18, 2025.
The reduction brings the SBP’s forex reserves down to $10.205 billion, compared to $10.572 billion recorded just a week earlier on April 11.
According to the SBP’s weekly report released on Thursday, this decline in forex reserves is primarily due to scheduled foreign debt repayments made by the federal government. Such repayments, though necessary for maintaining international creditworthiness, continue to place pressure on the central bank’s reserve position.
Despite the fall in the SBP’s holdings, there was a noticeable increase in forex reserves maintained by commercial banks. These rose by $141 million, reaching $5.231 billion by April 18, compared to $5.09 billion the previous week. The central bank noted that this increase can be attributed to inflows from workers’ remittances and export earnings, which continue to serve as vital sources of foreign currency for the country.
Overall, the total liquid forex reserves of Pakistan, which include both SBP and commercial bank holdings, stood at $15.436 billion by April 18, reflecting a net decrease of $226 million from $15.662 billion a week earlier. This reduction once again underscores the volatility and external vulnerabilities of Pakistan’s forex reserves situation.
However, there is a glimmer of optimism. Pakistan is expecting a significant inflow of over $1 billion from the International Monetary Fund (IMF) as part of the ongoing Extended Fund Facility (EFF). This disbursement is expected to arrive in the coming weeks and would substantially bolster the SBP’s forex reserves, providing much-needed support to the country’s external account and enhancing investor confidence.
As the SBP continues to navigate complex fiscal challenges, maintaining an adequate level of forex reserves remains a top priority for ensuring economic stability and exchange rate management in the face of global and domestic uncertainties.