SBP’s reserves fall by $134m to $7.8bn

• SBP-held foreign exchange reserves fall 1.7%.
• Pakistan has an import cover of 1.6 months.
• Net reserves held by banks amount to $5,819.3m.

KARACHI: Pakistan’s foreign exchange reserves held by the central bank once again fell by 1.7%.

According to data released by the State Bank of Pakistan (SBP), on November 18, the foreign currency reserves held by the central bank were recorded at $7,825.7 million, down $134 million compared with $7,959.5 million on November 11.

Overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $13,645 million.

Net reserves held by banks amounted to $5,819.3 million. The central bank attributed the decline to external debt repayment.

With the current foreign exchange reserves position, Pakistan has an import cover of 1.6 months.

The reserve position is expected to strengthen after Pakistan receives funds from friendly countries.

Earlier in the month, Finance Minister Ishaq Dar announced that the SBP will receive $500 million from the Asian Infrastructure Investment Bank (AIIB) in the ongoing month.

In a tweet, the finance minister shared that the AIIB board approved the funding as “co-financing of the Asian Development Bank (ADB) funded BRACE program for Pakistan.”

“These Funds will be received by SBP within November 2022,” he said.

Analysts believe a rather thin forex exchange reserves are not a good omen for the local currency which is currently not on firm footing against the US dollar.