SBP’s forex reserves deplete to $3.08 billion

• The forex reserves of the State Bank of Pakistan (SBP) fell to $3.086 billion by the week.
• The import bill for January 2023 has been recorded at $4.856 billion.
• The central bank attributed the decline to scheduled external repayments.

KARACHI: The official foreign exchange reserves of Pakistan fell to a level to provide only 20-day import cover, the data issued by the central bank showed on Thursday.

The forex reserves of the State Bank of Pakistan (SBP) fell to $3.086 billion by the week ended January 27, 2023, which is equal to providing import payment for 20 days only.

The import bill for January 2023 has been recorded at $4.856 billion, as per the Pakistan Bureau of Statistics (PBS) data.

The benchmark foreign exchange reserves of a central bank should be at a level to provide three months import cover.

The SBP’s foreign exchange reserves fell $592 million to $3.086 billion by week ended January 27, 2023, compared with $3.678 billion a week ago on January 20, 2023.

The official foreign exchange reserves of the SBP fell sharply to an almost nine-year low. Previously, the official reserves of the central bank were seen at this level at $3.87 billion in February 2014. The central bank attributed the decline to scheduled external repayments.

The foreign exchange reserves held by the central bank witnessed a record high of $20.146 billion by the week ended August 27, 2021. Since then, the official reserves of the SBP dropped by $17.06 billion.

Meanwhile, the foreign exchange reserves of the country recorded a decline of $711 million to $8.742 billion by the week ended January 27, 2023, compared with $9.453 billion by the week ended January 20, 2023.

The country’s foreign exchange reserves hit the all-time high of $27.228 billion on August 27, 2021. Since then, the foreign exchange reserves have declined by $18.486 billion.

The foreign exchange reserves of the commercial banks also fell $119 million to $5.656 billion by the week ended January 27, 2023, compared with $5.775 billion a week ago.

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