Pakistan's foreign exchange reserves hit 28-month low

KARACHI: Foreign exchange reserves of the State Bank of Pakistan (SBP) declined by $190 million to $10.308 billion during the week ended on May 6, data released by the central bank showed on Friday.

The country’s total foreign reserves, including net reserves of commercial banks, dipped to $16.375 billion, the central bank said.

Net foreign reserves held by commercial banks were US$ 6.067 billion.

Total liquid foreign #reserves held by the country stood at US$ 16.38 billion as of May 06, 2022. For details: https://t.co/WpSgomnd3v pic.twitter.com/EXe6IvGeoB

— SBP (@StateBank_Pak) May 13, 2022

The foreign exchange reserves of the country were $16.553 billion by week ended April 30, 2022.

After attaining a peak of $20bn in August 2021, the SBP reserves hit a 23-month low while the country’s total forex stocks also slumped to a 28-month low during the week ending on May 6.

The falling reserves put pressure on the domestic currency as it plunged to an all-time low of Rs191.77 in the interbank market.

The value of the greenback surged byRs1.75 on Thursday trading and closed at Rs191.77 in the interbank market, hitting an all-time high.

According to experts, the surging dollar has shattered the confidence of rupee-based economy and its stakeholders.

It is worth mentioning here that the coalition government, led by PM Shehbaz Sharif, is facing several economic challenges since coming into power in April 2022 after Imran Khan was dethroned as Pakistan PM through a no-confidence motion.

The new coalition setup, since then, had approached International Monetary Fund (IMF) and Saudi government for bailout packages. The federal government recently also held talks with UAE economic team in Lahore for “financial support”.

According to sources, talks between Pakistan and the International Monetary Fund (IMF) could resume on 18 May in Qata