SBP Reserves Sink by $278 Million to $8.3 Billion

The foreign exchange reserves held by the central bank decreased 3.2 percent on a weekly basis, according to data released by the State Bank of Pakistan (SBP) on Thursday.

On September 16, the foreign currency reserves held by the SBP were recorded at $8.346 billion, down $278 million compared to $8.624 billion on September 9.

Overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $14.07 billion. Net reserves held by banks stood at $5.724 billion, registering an increase of $31 million.

The central bank reserves are sufficient to cover an import bill of only 1.19 months, according to Arif Habib Limited.

The State Bank of Pakistan (SBP) had received proceeds of $1.16 from the International Monetary Fund on August 31. There was an expectation that friendly countries would also pitch in after the IMF tranche but so far any investments or safe deposits have not materialized.

However, there was some good news in the last week with Saudi Fund for Development (SFD) confirming the rollover of a $3 billion deposit placed with the State Bank of Pakistan (SBP) set to mature on December 5, 2022, for one year. The deposit is placed with SBP and is part of its forex reserves.

The current account deficit was also down to $0.703 billion in August as a result of the growth in exports and the substantial reduction in imports due to measures taken by the government.