April 19, 2024 (MLN): The State Bank of Pakistan’s (SBP) reserves are expected to remain around $9 billion by the end of FY24 and further increase to about $13.8bn in FY25, according to the International Monetary Fund's estimates.
To note, during the week ended on April 12, 2024, the foreign exchange reserves held by SBP rose by $14.4 million to $8.05bn despite a $1bn Eurobond repayment.
Governor SBP, Jameel Ahmad said that qualitative improvements in the external account have allowed the SBP to more than double its FX reserves from January 2023 ($3.1bn) to around $8bn on April 12, 2024 despite the repayment of a $1bn Eurobond on the same day.
He said that the external sector has stabilized, which reflected in the sharp reduction in the current account deficit (CAD) to $1bn during Jul-Feb FY24 from $3.8bn in the same period last year
Workers’ remittances have risen consistently since October 2023 on YoY basis, driven by incentives and regulatory measures to divert inflows towards formal channels.
At the same time, the SBP’s forward liabilities have also reduced significantly from $5.7bn in January 2023 to $3.4bn in February 2024.
The South Asian nation is nearing the end of a nine-month, $3bn loan program with the International Monetary Fund (IMF), with the final $1.1bn tranche of the deal likely to be approved later this month.
Pakistan has begun negotiations for a new multi-billion dollar loan agreement to support its economic reform program.
The country has achieved a semblance of economic stability after the 9-month SBA with IMF and is fully committed to entering into an extended program with the Fund to continue on the path of economic growth and development, said Finance Minister Muhammad Aurangzeb.
It is pertinent to mention here that Aurangzeb is leading Pakistan’s delegation in the IMF / World Bank’s 2024 Spring Meetings being held in Washington DC.
In the current fiscal year, total liquid foreign reserves have increased by $4.21bn or 46%.
Meanwhile, the current calendar year has seen an increase of $0.7bn or 5.53%.
Copyright Mettis Link News
Posted on: 2024-04-19T11:37:19+05:00
