The State Bank of Pakistan’s (SBP) foreign exchange reserves declined for the third week in a row, dropping by $72 million in the week ending August 1, bringing the total down to $14.232 billion.
Since July 11, the central bank has seen a cumulative decrease of $294 million, partially eroding the gains achieved by the close of the previous fiscal year.
At the end of FY25, SBP had built up reserves to $14.5 billion—exceeding targets set under the IMF programme, a development hailed as a significant policy achievement.
However, sustaining that level has become increasingly difficult due to continued pressure from external debt repayments.
The SBP cited scheduled debt servicing as the primary reason for the latest dip in reserves.
Pakistan’s external debt servicing remains a major strain on the economy, with around $26bn paid in FY25 and a similar amount projected for FY26.
These payments continue to exert downward pressure on the country’s foreign currency buffers.
According to SBP data, the country’s total liquid foreign reserves stood at $19.495bn as of Aug 1, which includes $5.263bn held by commercial banks.