Pakistan’s forex reserves increase by $51 million over previous week

ISLAMABAD: The State Bank of Pakistan (SBP) reported a slight increase in its foreign exchange reserves, which rose by $51.1 million or 0.56 percent to $9.15 billion for the week ended August 2, 2024.

This week-on-week improvement reflects a positive change in Pakistan’s financial stability.

A significant increase was also seen in the country’s total reserves, which rose by $80.2 million or 0.56 percent to $14.47 billion. Commercial banks contributed to the increase, with their deposits increasing by $29.1 million, or 0.55 percent, to $5.32 billion.

Despite this recent growth, State Bank’s reserves have declined by $236.2 million or 2.52 percent since the beginning of the current fiscal year. However, the broader picture for the calendar year is more optimistic, with reserves increasing by $932.1 million, or 11.34 percent.

In a major development, Pakistan has negotiated a $7 billion loan agreement with the International Monetary Fund (IMF), pending approval by the IMF’s Executive Board. This loan is expected to further improve the financial condition of the country.

Additionally, State Bank Governor Jameel Ahmed has given assurances about the country’s fiscal outlook. He confirmed that more than $16 billion of the outstanding debt for fiscal year 2025 will be paid by friendly countries.

The rollover would ease the government’s fiscal pressure, reducing the remaining debt payments for the fiscal year to $10 billion through June 2025.