SBP-held forex reserves rise by $11 million in a week

KARACHI: Pakistan’s foreign exchange reserves increased by $11 million this week, pushing the State Bank of Pakistan’s (SBP) holdings to $14.24 billion.

The rise lifted the country’s total liquid reserves to $19.50 billion as of August 8, according to figures released by the central bank on Friday.

The improvement comes two years after reserves had slipped to a dangerous low in mid-2023, falling below $4 billion and sparking fears of a sovereign default. At the time, the stock was barely enough to cover a few weeks of imports.

Since then, the government has turned to the International Monetary Fund (IMF) for support, securing two loan programmes, introducing lender-backed reforms, and pushing for foreign investment through economic diplomacy. Efforts have also been made to strengthen remittance inflows via banking channels and move towards export-driven growth.

According to the SBP, total liquid reserves stood at $19,496.7 million as of August 8. Of this, the central bank held $14,243.2 million, while commercial banks accounted for $5,253.5 million.

The bank noted the reserves had inched up by $11 million during the week, but did not cite specific reasons. Officials have earlier said that recent gains reflect stronger inflows and earnings rather than fresh external borrowing.

SCRA activity

Meanwhile, the Special Convertible Rupee Account (SCRA) balance slipped by Rs750.99 million during the week ending August 8, closing at Rs27,359.36 million.

Data from the SBP showed a net purchase of securities worth Rs788.41 million during the week. Inflows into the account reached Rs8,345.15 million, which included Rs3,543.95 million in remittances, Rs4,801.14 million from securities sales, and Rs0.06 million in dividends.

Outflows were recorded at Rs9,096.14 million, driven by outward remittances of Rs3,453.87 million, securities purchases worth Rs5,589.55 million, and Rs52.72 million paid in taxes.

Read next: Gold ends week with total loss of over Rs6,000 per tola