August 11, 2022 (MLN): The total liquid foreign exchange reserves held by the country dropped by $648 million or 4.6% WoW to stand at $13.56 billion during the week ended on August 5, 2022, compared to $14.2bn in the previous week, weekly data released by the State Bank of Pakistan (SBP) on Thursday showed.
Data further revealed that reserves held by the central bank during the week dipped by $555mn or 6.6% WoW to clock in at $7.83bn mainly due to external debt payments which are expected to moderate during the next three weeks of this month. In fact, around three-fourth of debt servicing for the month of August was concentrated during the first week.
Similarly, reserves of commercial banks went down by $92mn or 1.6% WoW to $5.73bn.
Meanwhile, it is important to note that, the current level of foreign currency reserves is barely enough to cover 1.1 months of import bill.
However, the government officials are hopeful that Pakistan will soon receive the funds from the International Monetary Fund (IMF) as the country is expected to receive the Letter of Intent (LoI) from IMF before this weekend as the country’s deal with the fund to release two tranches worth $1.17bn under a stalled loan facility is trudging closer to the finish line.
Senior officials at the Finance Ministry told The News that the fund was likely to send an LoI “anytime soon as the IMF’s mission chief had to rush to Australia for some personal engagement”. “We may receive LoI within the next 24 hours and then it will be jointly signed by the Minister for Finance Miftah Ismail and Governor SBP.”
The finance minister, when contacted, said, “the LoI would be dispatched soon for reviving the IMF programme by the end of the ongoing month”.
On the forex front, PKR while maintaining its gaining spree, appreciated by three rupees against the US dollar in today's interbank session as the currency closed the trade at PKR 218.88 compared to yesterday's closing of 221.91 per USD.
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