Foreign Currency deposits decline 2% YoY in July’20

August 17, 2020 (MLN): Foreign Currency Deposits during the month of July 2020 stood at $7.75 billion, depicting a decline of 2%YoY.

While on a month-on-month basis, it marked an increase of 3% MoM as in June 2020 it recorded at $7.52 billion, shows SBP updated data on foreign currency deposits and its utilizations.

The dreary growth in foreign currency deposits is mainly associated with PKR stability, it indicates that Rupee based accounts offer massive returns due to which investors become reluctant to convert their savings into dollar deposits.

According to the data issued by SBP, foreign currency deposits by Residents stood at $6.86 billion during the month under review which was only 3% higher than deposits reported in June 2020, while 4% weakened as compared to deposits of July 2019.

As these deposits help to finance large fiscal and external current account deficits, during the month $289 million has been utilized to finance country’s exports whereas, $401 million has been utilized for import financing.

Further, $1.16 billion has been placed with SBP, while $51 million and $611 million placed within Pakistani banks and outside Pakistan respectively.

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