National FX reserves fall to their lowest level in nine years as payments for external debt rise.

Pakistan’s foreign exchange reserves fell to a nine year low last week following a heavy external debt and other payments worth nearly a billion dollars.

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The State Bank of Pakistan (SBP) provided data on Thursday indicating that due to the repayment of external debt, foreign exchange reserves held with the central bank decreased by $923 million over the week ending January 20, 2023.

As a result, the nation’s reserves decreased to just $9.453 billion for the week ending January 20, 2023, from $10.444 billion for the week ending January 13, 2023.

This was the lowest level since national reserves dropped to $9.708 billion in December 2018.

At the same time, the central bank’s reserves decreased to $3.678 billion from $4.601 billion. Since February 2014, when reserves fell to $3.919 billion, this was the SBP’s lowest reserve value.

During the past week, there was also a decline in the reserves that commercial banks held. They decreased by $67.6 million this week, from $5.842 billion the previous week to $5.775 billion this week.

The reserves are much lower than what is required to cover the country’s imports for a month.

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