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Pakistan Reserves Drop $1.3 Billion as SBP Makes External Debt Repayments

Planned inflows from a $700 million multilateral payment plus about $1.7 billion of commercial loan refinancing are set to restore reserve headroom by June 30 and ease near-term external funding pressure

Overview

  • SBP-held foreign exchange reserves fell by $1.305 billion to $15.916 billion in the week ended June 19, with the decline driven mainly by scheduled external debt repayments.
  • The central bank reported it has received $700 million from a multilateral institution and about $1.7 billion as refinancing of a government commercial loan, and said these flows will appear in the June 30 reserve snapshot.
  • Pakistan’s total liquid foreign reserves were $21.485 billion on June 19, of which commercial banks held $5.568 billion in net foreign assets separate from SBP reserves.
  • Markets showed a tiny rupee appreciation and weaker local gold prices as renewed USIran tensions pushed oil prices and influenced short-term commodity moves that can feed into inflation and rate expectations.
  • The recent swings reflect timing effects where end-of-week and end-of-month snapshots can overstate short-term stress or relief, and the incoming disbursements should ease near-term debt service and liquidity pressures while leaving longer-term financing needs to monitor.