According to data released by the State Bank of Pakistan (SBP) on Thursday,the central bank’s foreign exchange reserves decreased by $81 million on aweekly basis. On August 25, the foreign currency reserves held by the SBPwere reported to be $7.849 billion, reflecting a decline of $81 millioncompared to the reserves of $7.930 billion recorded on August 18.
In addition to the SBP’s reserves, the overall liquid foreign currencyreserves held by Pakistan, which includes net reserves held by banks otherthan the SBP, amounted to $13.171 billion. This figure marked a decrease of$77 million over the previous week. The net reserves held by banks,standing at $5.322 billion, experienced a marginal increase of $4 millionduring the same week.
Interestingly, this recent decrease in reserves on a weekly basis marks thefifth such decline within the last six weeks. Since July 14, the centralbank’s reserves have witnessed a significant drop of $878 million, with thereserves standing at $8.727 billion back then.
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These fluctuations in foreign exchange reserves can have variousimplications for the country’s economy. A decrease in reserves might impacta nation’s ability to manage its currency’s value and fulfill internationalpayment obligations. Central banks often utilize foreign exchange reservesto stabilize their economies during times of economic uncertainty or tointervene in the foreign exchange market to control exchange ratemovements. The recent decline in Pakistan’s reserves could be a result offactors such as trade imbalances, debt repayments, or changes in globaleconomic conditions.
