SBP reserves increase by $77 million, reaching $7.26 billion in one week

WEB DESK: During the week ending on November 24, 2023, the State Bank of Pakistan (SBP) saw a noteworthy increase of $77 million in its foreign exchange reserves, reaching a total of $7.26 billion, as reported in data released on Thursday.

The country’s overall liquid foreign reserves amounted to $12.39 billion, with commercial banks holding net foreign reserves of $5.13 billion.

This surge in SBP’s reserves comes in the wake of various factors affecting the economic landscape.

In July of this year, the central bank experienced a positive boost when Pakistan received approximately $1.2 billion as the first tranche from the International Monetary Fund (IMF), following the approval of a new $3-billion stand-by arrangement (SBA).

Additionally, inflows from Saudi Arabia and the UAE contributed to the growth in reserves.

Despite these positive developments, SBP’s reserves have faced challenges, including pressures from debt repayments, increased import payments after the easing of restrictions, and a shortage of fresh inflows.

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In a significant development, the IMF recently announced that a staff-level agreement had been reached with Pakistani authorities regarding the first review of the SBA.

However, it’s important to note that this agreement is pending approval by the IMF Executive Board.

Addressing concerns about external financing, Caretaker Finance Minister Dr Shamshad Akhtar expressed confidence, stating that the government anticipates increased inflows in December 2023.

This optimistic outlook is expected to contribute to the further augmentation of foreign exchange reserves.