KARACHI: The central bank’s foreign exchange reserves fell $303 million to a three-year low of $7.597 billion in the week ending Oct. 7, it said on Thursday, while the rupee also fell for a second day.
Reserves fell due to foreign debt payments, including commercial loan payments and interest and Eurobond payments, the State Bank of Pakistan (SBP) said.
Reserves held by commercial banks fell by about $39 million to $5.649 million for the week. The country’s total reserves now stand at $13.247 billion, down $342 million from the previous week.
The SBP had reserves of $7.29 billion at the end of the 2018-19 fiscal year, which increased to $12.13 billion and then to $17.29 billion in subsequent years before falling to $9.19 billion at the end of the previous fiscal year.
Rupee continues to fall against dollar for second day, closes at 218.38
Meanwhile, the rupee fell 0.23 percent in the interbank market to close at 218.38 per dollar on Thursday. Before that, the rupee rose for 13 consecutive sessions, going from 239.71 on 22nd September to 217.79 on 11th October, a difference of around Rs22.
On the open market, the local currency was trading at Rs 222 against the dollar on Thursday, up Rs 1.50.
Forex market pundits believe the decline in foreign exchange reserves threatens the rupee’s recent rally at a time when the finance minister wants it to drop below 200 rupees against the dollar.
They see the local currency struggling to make gains in the coming days, particularly in the wake of the dollar’s bullishness around the world against major currencies.
However, some important developments are expected on the external front of the economy, such as the deferral of Chinese loans and inflows from the World Bank, the Asian Development Bank and other sources of credit.
Posted in Alba, October 14, 2022