RECORDER REPORT

KARACHI: The country’s total liquid foreign exchange reserves sharply fell by $270 million in a week mainly due to massive decline in the reserves held by the commercial banks. According to State Bank of Pakistan’s (SBP) weekly foreign reserves report issued on Thursday, the total liquid foreign reserves held by the country stood at $14.315 billion as of May 24, 2024 compared to $14.585 billion as of May 17, 2024.

Most of the decline was witnessed in the reserves held by the commercial banks, while SBP’s reserves posted a slight droop during the week under review.

During the week ended on May 24, 2024, SBP reserves decreased by $63 million to $9.094 billion down from $9.157 billion a week earlier due to external debt repayments.

Interestingly, despite continued external debt servicing, the SBP is maintaining its reserves above $9 billion supported by a surplus current account.

However, the Net foreign reserves held by commercial banks registered a notable decline of $207 million in a week. With this decrease, the net foreign reserves held by commercial banks stood at $5.222 billion at the end of the week as against $5.428 billion at the end of the previous week.

Analysts said this sharp fall in the banks’ reserves could be due to the Hajj season and summer holidays, of which people had withdrawn their savings.

It may be mentioned here that after completing a short term $3 billion loan programme, the federal government is engaged with the IMF for another long-term loan programme to build its foreign exchange reserves.