By Staff Reporter
KARACHI: Foreign exchange reserves held by the State Bank of Pakistan (SBP) plummeted by a record $2.66 billion in a single week, driven by hefty external debt repayments, marking the steepest decline in more than three years.
The SBP reserves dropped to $9.06 billion as of June 20, 2025, the lowest level since July 2024, according to data released on Thursday. The fall eclipsed a previous record weekly decline of $2.9 billion in March 2022, underscoring the mounting pressure on the country’s foreign exchange buffers.
“The decline was primarily due to the Government of Pakistan’s external debt repayments, mainly commercial borrowings,” the SBP said in a statement. It specified that reserves decreased by $2,657 million to $9,064.5 million during the week ended June 20 due to these payments.
Pakistan’s total liquid foreign reserves, including those held by commercial banks, stood at $14.39 billion, with net reserves at commercial banks clocking in at $5.33 billion. The sharp drawdown at the central bank reflects the government’s struggle to balance its repayment obligations amid a fragile external position.
Relief, however, is near. The SBP said it has received $3.1 billion in commercial loans and more than $500 million in multilateral financing during the current week. “These inflows will be reflected in SBP’s FX reserves for the week ending on 27-Jun-2025,” the central bank noted, signaling a potential rebound in the coming data release.
The decline comes despite earlier optimism from SBP Governor Jameel Ahmad. Speaking at an event at the Pakistan Stock Exchange in April, Ahmad had raised the bank’s forecast for reserves to $14 billion by the end of June 2025, up from a prior estimate of $13 billion. That target now appears increasingly out of reach.
Just a week earlier, the SBP had reported a modest uptick, with reserves rising by $46 million to $11.72 billion as of June 13.
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