SBP-held foreign reserves fall 4.17% to $7.5bn

• SBP-held forex reserves drop to $7,498.7 million.
• Overall forex reserves stand at $13,378.2 million.
• Reserves expected to register gains next week.

KARACHI: State Bank of Pakistan (SBP)-held foreign exchange reserves declined by 4.17% in line with the dominant trend for the last several weeks.

The foreign currency reserves held by the SBP were recorded at $7,498.7 million as of November 25, down $327 million compared with $7,825.7 on November 18, data released by SBP showed.

Overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $13,378.2 million.

Net reserves held by banks amounted to $5,879.2 million. The central bank cited external debt repayment as the reason behind this decline.

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

The reserves are expected to register gains next week as the Government of Pakistan received $500 million from Asian Infrastructure Investment Bank (AIIB).

The Ministry of Finance, in its tweet, had said that funds are deposited with SBP and “will augment Pakistan’s reserves”.

The development did not reflect in SBP’s data as the amount was received after the cut-off date. The assistance will reflect in the reserves next week.

However, Pakistan has to repay a $1.08 billion international bond, which matures on December 5.

This payment might put additional pressure on the already depleting foreign exchange reserves as SBP Governor Jameel Ahmad last week, in the post-monetary policy briefing, revealed that the payment will be made three days before its due date i.e. December 5.