Pakistan forex reserves in sharpest dip in two years

The foreign exchange reserves of the central bank have dipped to $10,308 witnessing a fall of $190 million during the week ending on May 6 – the lowest level since Dec 2019, reported 24NewsHD TV channel.

According to the date released by the State Bank of Pakistan on Friday, country has been left with only $16.38 billion total liquid foreign exchange reserves.

The State Bank has got $10,308.7 billion forex reserves in its possession whereas the net reserves held by other commercial banks are $6,067.0 billion making the grand total to $16,375.7 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

Pakistan is currently facing grave economic situation as its currency is continuously losing its steam and shedding its value enormously against dollar.

According to the foreign exchange dealers, the new price value of the US dollar during morning session of interbank trading on Friday was Rs193 - all-time new high.

The picture at the Pakistan Stock Exchange is also dismal as benchmark PSX 100-index plummeted by 500 points registering a 1.16 percent decrease and the index was plunged to 42,367 points.

The investors are cautious in the wake of alarming inflation that soared with every passing week and became a headache for the new government too.

The delay in the revival of the International Monetary Fund $1 bailout programme along with lack of pledges of funding from the friendly countries is adding pressure to the foreign reserves and Pakistani currency.

The new government is embroiled in the prevailing economic predicament and is trying to secure external flows to shore up its reserves and currency devaluation.

To help it out on the economic front, the Asian Development Bank on Thursday hinted at providing an additional $2 billion funds to the government so that its balance of payments position could be strengthened.

The assurance came at a meeting of Minister of State for Finance Dr Aisha Ghous Pasha and the ADB’s Country Director in Islamabad Yong Ye and their respective teams. The meeting discussed “additional funding avenues for Pakistan including ADB’s programme loans and countercyclical support facility (CSF)” — a relatively new mechanism to help finance oil imports amid unprecedented global prices.