Karachi, April 10, 2025 – Pakistan’s foreign exchange reserves held by the State Bank of Pakistan (SBP) saw a modest increase of $23 million during the week ending April 4, 2025, pushing the central bank’s total holdings to $10.70 billion, according to data released by the SBP on Thursday. The slight uptick in reserves reflects a continuation of recent positive trends, although the central bank has not attributed this increase to any specific inflow or policy move.
The overall foreign exchange position of the country, which includes reserves held by commercial banks, stood at $15.75 billion as of the latest reporting date. This total comprises $10.70 billion held by the SBP and $5.05 billion in net foreign reserves maintained by commercial banks. The central bank’s update underscores that while the reserves remain relatively stable, they are still highly sensitive to both internal and external economic variables, including debt repayments, remittance inflows, and global commodity price movements.
The increase, although relatively minor compared to weekly reserve fluctuations in past months, contributes to a cautious sense of optimism among economists and financial analysts monitoring Pakistan’s external sector. Last week, the SBP’s reserves rose by $70 million, bringing the previous total to $10.68 billion. The current week’s $23 million increase represents a continued, albeit slower, momentum in building the country’s foreign exchange buffer.
Despite the lack of an official explanation from the SBP regarding the source of this week’s reserve increase, market observers suggest the improvement could stem from ongoing bilateral financial support, foreign aid disbursements, or improved inflows from export receipts and remittances. With the fiscal year moving toward its close in June, the central bank is expected to remain focused on safeguarding reserve adequacy in light of looming external obligations.
The broader liquid reserves of $15.75 billion provide some relief for a country still navigating macroeconomic challenges, including a narrow fiscal space, inflationary pressures, and the need for structural reforms. Commercial banks’ reserves at $5.05 billion indicate healthy liquidity levels in the private banking sector and suggest a stable inflow of foreign exchange through the formal financial system.
The role of foreign exchange reserves remains crucial in shaping investor confidence and maintaining currency stability. The State Bank uses these reserves to manage exchange rate volatility and ensure timely payments for imports, foreign debt servicing, and other international obligations. A stable or rising reserve trend is typically viewed as a positive signal by global financial institutions and credit rating agencies, particularly in the context of Pakistan’s ongoing discussions with the International Monetary Fund (IMF) and other development partners.
As the global economic landscape continues to evolve—with fluctuating oil prices, shifting interest rates, and uncertain geopolitical conditions—Pakistan’s ability to maintain and grow its reserves will play a pivotal role in defining its economic resilience. The SBP is expected to remain proactive in its monetary policy approach while facilitating macroeconomic stability through prudent reserve management.
The market will closely watch the coming weeks to see if the positive trajectory in foreign exchange holdings can be sustained. With critical policy milestones ahead and fiscal year-end targets in sight, the importance of foreign reserve health has never been more pronounced.