SBP Forex Reserves Fall to Single Digits for the First Time Since 2019

The foreign exchange reserves held by the central bank decreased 3.46 percent on a weekly basis, according to data released by the State Bank of Pakistan (SBP) on Thursday. On May 27, the foreign currency reserves held by the SBP were recorded at $9.723 billion, down $366 million compared with $10.089 billion on May 20. The central bank reserves are currently at a 128-week low, the lowest level since December 2019. The central bank said that the decline in the reserves was due to the external debt payment. Overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $15.771 billion. Net reserves held by banks amounted to $6.049 billion. Finance Minister Miftah Ismail announced on Thursday that the terms and conditions for refinancing of $2.3 billion deposit by Chinese banks have been agreed. The deposit from the Chinese banks will give much needed support to the country’s reserves. The news of the agreement with the Chinese Banks comes as a major relief as the country remains embroiled in an uncertain economic condition due to the delay in the revival of the bailout program of the International Monetary Fund (IMF).