In Pakistan, total foreign exchange reserves rose to a record $26.864 billion. Over the week, the figure increased by $110 million, from $26.754 billion, Dawn reports.
Central bank reserves
The State Bank of Pakistan reported that its own foreign exchange reserves increased by $39 million over the week. As of October 30, they stood at $21.568 billion, compared with $16.568 billion in February.
Commercial banks’ foreign currency assets increased by $70 million over the week. According to the central bank, this reflects an excess of inflows to banks over outflows.
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Trade and the rupee exchange rate
Financial sector representatives consider the current level of reserves sufficient to maintain exchange-rate stability and encourage exporters to repatriate foreign currency earnings more quickly. At the same time, currency experts cited by the publication consider the Pakistani rupee overvalued. In their view, this gives importers access to cheaper dollars and is one of the reasons for the monthly increase in the trade deficit.
From July to October of FY27, Pakistan’s trade deficit amounted to $14.6 billion: imports reached $26 billion, while exports totaled $11.4 billion. The article also notes that there is a view that exchange-rate stability is being maintained through remittances, which increase every year.
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