April 10, 2025 (MLN): In a steady sign of resilience for Pakistan’s external financial position, the foreign exchange reserves held by the State Bank of Pakistan (SBP) saw a week-on-week increase of $23.1 million, bringing the total to $10.7 billion as of April 4, 2025. According to data released by the SBP on Thursday, this marks a 0.22% rise from the previous week’s figure, and while modest, it highlights consistent efforts to maintain macroeconomic stability amid ongoing fiscal challenges and global financial uncertainties.
In addition to the central bank’s reserves, the overall foreign exchange reserves of the country also posted growth during the same period. Total reserves, which include those held by commercial banks, rose by $173 million on a weekly basis, showing an increase of 1.11% and bringing the total to $15.75 billion. This broader improvement in reserve position is viewed positively by economic observers, as it strengthens Pakistan’s buffer against external shocks and supports the country’s ability to manage international payment obligations.
A major contribution to the weekly rise in total reserves came from the commercial banking sector. Reserves held by commercial banks jumped by $149.9 million or 3.06% compared to the previous week, pushing the total to $5.05 billion. The surge in bank-held reserves reflects increased liquidity in the financial system and may be attributed to inflows related to remittances, export receipts, or foreign investment transactions routed through private financial institutions. It also indicates increased confidence in the private banking sector and the country’s broader financial architecture.
Zooming out to a broader fiscal context, reserves held by the SBP have increased by $1.31 billion during the current fiscal year, translating to a growth of 13.95%. This growth trajectory reflects improvements in current account performance, reduced import pressure, and financial assistance from international lending institutions. These cumulative efforts by fiscal and monetary authorities have helped to strengthen the reserve position and bolster macroeconomic indicators.
However, when viewed from the start of the current calendar year, SBP reserves have actually declined by $1.01 billion or approximately 8.63%. This contrast between fiscal year gains and calendar year losses illustrates the volatility of Pakistan’s external account position and the complex interplay of inflows and outflows. Earlier months in 2025 saw substantial external debt repayments and fluctuating remittance levels, which contributed to a temporary decline before the recent rebound began taking shape.
While the $23 million weekly increase may not be headline-grabbing in isolation, it is a meaningful indicator of cautious but steady improvement in the country’s foreign reserve position. Reserve growth is crucial for economic stability, influencing everything from currency valuation to investor sentiment. A healthy reserve cushion helps the State Bank of Pakistan manage exchange rate volatility and maintain confidence among domestic and international stakeholders.
As global economic conditions remain unpredictable, the central bank’s continued focus on prudent reserve management, fiscal discipline, and external financing strategy will be key in sustaining this positive momentum. The rise in reserves—both at the central and commercial bank levels—offers a degree of reassurance and reflects gradual progress in strengthening Pakistan’s external financial footing.