FX reserves climb as SBP maintains market stability

Karachi: Pakistan’s foreign exchange reserves held by the State Bank of Pakistan (SBP) inched up by USD 16 million to USD 14.471 billion during the week ending October 24, according to data released by the central bank on Thursday.

Despite the modest increase, the country’s overall liquid foreign reserves fell to USD 19.687 billion from USD 19.853 billion a week earlier, as commercial banks’ holdings declined to USD 5.216 billion from USD 5.398 billion.

The SBP said in a recent monetary policy statement that its reserves continued to grow even after the repayment of a USD 500 million Eurobond. Over the past three years, the central bank has purchased more than USD 20 billion from the interbank market, and these operations have continued after meeting repayment and repatriation obligations.

Read: SBP keeps key rate steady, upgrades GDP forecast for FY26

Looking ahead, the SBP expects its reserves to rise to USD 17.8 billion by the end of the current fiscal year, supported by a contained current account deficit and the inflow of planned external financing. It projected reserves at USD 15.5 billion by December 2025 and USD 17.8 billion by June 2026, assuming stable macroeconomic conditions.

The central bank also reaffirmed that it will continue to meet all external debt obligations on time. For fiscal year 2026, Pakistan’s total net repayments amount to USD 10 billion, of which USD 3.1 billion has already been settled.

In addition, the SBP anticipates a stronger outlook for workers’ remittances, forecasting inflows of over USD 41 billion in FY26, compared with USD 38 billion in the previous fiscal year.

To strengthen its reserve position, the SBP purchased USD 7.15 billion from the interbank market between August 2024 and July 2025, including USD 189 million in July alone.

Economists say the steady buildup of reserves, despite ongoing debt repayments, reflects improved external management and stability in Pakistan’s foreign exchange market.