Pakistan’s foreign exchange reserves received a notable boost this past week, with the State Bank of Pakistan (SBP) reporting an increase of $1.77 billion, or nearly 14 percent week-on-week, bringing the central bank’s total reserves to a robust $14.5 billion by July 4, 2025. According to data released by the SBP on Thursday, this sharp rise primarily stems from official inflows, which have significantly strengthened the country’s external buffers at a time when global economic uncertainties and local financing needs demand greater resilience.
Alongside the improvement in the SBP’s holdings, the nation’s overall foreign exchange reserves, which also include deposits held by commercial banks, climbed by $1.94 billion or 10.71 percent week-on-week, reaching $20.03 billion. The reserves maintained by commercial banks themselves recorded an increase of $163 million, standing at $5.53 billion, which reflects a steady buildup of liquidity within the broader banking system.
In a year-to-date snapshot, the gains appear even more substantial. During the current fiscal year alone, the SBP’s foreign exchange reserves have grown by $5.44 billion, translating into an impressive rise of nearly 60 percent. Looking at the calendar year 2025 so far, reserves under SBP management have expanded by $2.79 billion, marking a 23.84 percent increase. This upward trajectory has been critical for bolstering market confidence and easing concerns around Pakistan’s ability to meet external debt obligations and import needs.
Breaking down the numbers further, official data shows that on June 27, 2025, SBP-held reserves stood at $12.72 billion, which surged by $1.77 billion to $14.5 billion by the following week. Over the same period, net foreign reserves held by commercial banks rose from $5.36 billion to $5.53 billion. As a result, the country’s total liquid foreign reserves advanced from $18.09 billion to over $20 billion — a level that helps provide critical cover for several months of imports and contributes to exchange rate stability.
The recent accumulation is largely attributed to the arrival of planned official inflows, which may include disbursements from multilateral partners or proceeds from external financing arrangements that Pakistan has secured to shore up its balance of payments. Such inflows play a pivotal role in stabilizing the rupee against the dollar and supporting monetary policy initiatives aimed at taming inflation without exerting undue pressure on the currency.
This strengthening of reserves comes at a time when Pakistan continues to implement broader structural reforms in its fiscal and monetary frameworks, aiming to ensure long-term macroeconomic stability. With international oil prices fluctuating and domestic import bills remaining sizable, a higher reserve cushion provides the necessary room to absorb external shocks and manage short-term volatilities.
While challenges remain on the economic horizon, the consistent rise in the SBP’s reserves sends a reassuring signal to investors and trade partners alike, underlining Pakistan’s commitment to maintaining a sound external position. It also underscores the effectiveness of recent policy measures that have prioritized prudent reserve management and improved coordination with international financial institutions.