Pakistan’s foreign exchange reserves recorded a slight increase, reaching $19.81 billion for the week ended October 3, 2025, according to the latest data released by the State Bank of Pakistan. This modest rise reflects growing expectations of external inflows and policy stability as the country awaits its next loan tranche from the International Monetary Fund.
The total reserves edged up by $14 million from $19.796 billion reported on September 26, 2025. SBP’s official reserves increased by $20 million, reaching $14.42 billion compared to $14.40 billion a week earlier. In contrast, commercial banks’ reserves experienced a marginal dip of $6 million, slipping to $5.39 billion from $5.396 billion previously.
Economists view this gradual improvement as a sign of cautious optimism in the external account. The country is expecting the disbursement of the third tranche under the IMF’s Extended Fund Facility (EFF), which is likely to further strengthen Pakistan’s reserve position in the coming weeks. This anticipated inflow is seen as a critical factor in maintaining external stability and shoring up investor confidence.
Following its recent review on October 8, the IMF expressed satisfaction with Pakistan’s ongoing economic reforms and compliance with the loan program’s structural benchmarks. This positive assessment is expected to pave the way for additional funding support, which may ease pressure on the exchange rate and boost foreign currency buffers.
Market analysts suggest that sustained inflows from multilateral lenders, combined with steady remittance volumes, could help maintain a stable foreign exchange position through the final quarter of the year. They highlight that improving foreign reserves may also provide the central bank with greater flexibility in managing exchange rate volatility and meeting external debt obligations without resorting to emergency borrowing.
The SBP continues to maintain a vigilant stance over the external account, aiming to preserve reserve adequacy and ensure smooth foreign payments amid a shifting global economic environment. This stability is particularly significant for Pakistan as it navigates fiscal consolidation measures and works to rebuild market confidence after years of external account vulnerabilities.
Financial experts also point to the positive impact of declining global commodity prices and controlled import demand as contributing factors behind the steady reserve levels. While the increase remains modest, it signals a more stable outlook for Pakistan’s external sector compared to previous years marked by sharp fluctuations.
With expectations of further inflows from the IMF, bilateral partners, and multilateral institutions, the government is positioning itself to create a stronger external financing cushion. This could help shield the economy from global shocks, stabilize the currency, and support long-term economic recovery efforts.
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