Pakistan’s foreign exchange reserves rise by $18 million in a week

Pakistan’s foreign exchange reserves recorded a modest increase of $18 million over the past week, according to data released by the State Bank of Pakistan (SBP), reflecting continued stability in external accounts amid recent inflows and repayments.

The central bank reported that its reserves rose to $15.0976 billion after a weekly increase of $18 million. The overall improvement comes despite ongoing external debt repayments and adjustments linked to earlier deposits.

According to official figures, Pakistan’s total liquid foreign reserves stood at $20.6285 billion as of April 17. Of this, commercial banks held $5.5309 billion, while the central bank accounted for the remainder.

Officials noted that inflows from friendly countries and multilateral support have helped stabilise the reserve position. In particular, recent inflows from Gulf partners have supported short-term liquidity needs, although some repayments have partially offset these gains.

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The SBP also highlighted that after adjustments linked to deposit repayments to partner countries, reserves showed a net improvement during the reporting period. These movements reflect ongoing external financing arrangements and debt management operations.

Economists say the relatively stable reserve position is supported by improved current account performance and higher remittance inflows. Seasonal factors, including Eid-related remittances, are also expected to provide further support in the coming weeks.

Authorities remain optimistic that foreign exchange reserves will strengthen further in the medium term, driven by continued inflows from multilateral lenders and friendly countries, along with expected external financing under ongoing economic reform programmes.

However, analysts caution that Pakistan’s external position remains sensitive to debt repayments and global financial conditions, making sustained inflows crucial for maintaining stability.

Despite these challenges, the latest data suggests a gradual improvement in external buffers, offering some relief to policymakers managing inflation, currency stability, and external financing pressures.