SBP records $112 million weekly increase in foreign exchange reserves

KARACHI: The State Bank of Pakistan (SBP) reported a $112 million increase in its foreign exchange reserves, reaching $9.403 billion for the week ending August 23.

The country’s total foreign exchange reserves, including those held by commercial banks, rose to $14.776 billion. However, commercial bank reserves saw a slight decrease of $3 million, amounting to $5.272 billion for the week.

The central bank did not specify the source of this influx.

In a recent interview, SBP Governor Ahmed Jameel revealed that the government has sought a $4 billion loan from Middle Eastern banks. This move follows media reports of difficulties in rolling over Chinese loans.

Additionally, the International Monetary Fund (IMF) executive board appears hesitant to approve the Staff-Level Agreement for a new 37-month, $7 billion Extended Fund Facility.

The IMF is reportedly waiting for Pakistan to secure debt rollovers from allied countries.

During the first month of the new fiscal year, Pakistan’s trade deficit with nine neighbouring countries surged by 68.72 per cent, climbing to $1.041 billion from $0.617 billion a year earlier. Experts attribute this increase to higher imports from China and India.

The trade deficit for FY24 stood at $9.506 billion, a 49 per cent rise from $6.382 billion in the previous fiscal year.

In July, exports to China, Afghanistan, Bangladesh, and Sri Lanka improved. However, exports to other regional countries continued to decline.

Data from the State Bank of Pakistan shows that exports to these nine countries — Afghanistan, China, Bangladesh, Sri Lanka, India, Iran, Nepal, Bhutan, and the Maldives — grew by 23.85 per cent to $464.75 million, up from $375.24 million the previous year.

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