Pakistan’s forex reserves with SBP drop to 9-year-low of $3.09bn
Arif Habib Limited calculates that the reserves are at their lowest since February 2014 and cover 18 days worth of imports.
Pakistan’s foreign exchange reserves held by the central bank decreased by 16.1 per cent to $3.09 billion in the week ending Jan 27, the State Bank of Pakistan (SBP) said on Thursday, which analysts said covers less than three weeks of imports.
The country is locked in negotiations with the International Monetary Fund (IMF) to release much-needed money under a stalled bailout programme. A successful outcome with the IMF would also help to release money from other platforms that are looking for a greenlight from the lender.
The central bank said in a statement that the drop in reserves (of $592m) was due to external debt repayments.
Reserves held by commercial banks stood at $5.65bn, taking total liquid reserves in the country to $8.74bn, SBP added.
Investment firm Arif Habib Limited (AHL) calculated that the reserves are at their lowest since February 2014 and now only cover 18 days’ worth of imports.
“The country is in dire need of fresh inflows and the resumption of the IMF programme as soon as possible to avoid the crisis,” Tahir Abbas, head of research at AHL said.