KARACHI, Dec 2: Pakistan's liquid foreign exchange reserves fell to $11.987 billion on November 27 from $12.253 billion at the end of October, showing a decline of $266 million in a little less than a month.

This is for the first time that the reserves have fallen below the crucial level of $12 billion.

According to data released by the State Bank on Thursday, forex reserves held by the central bank totalled $9.348 billion, whereas the reserves held by the banking system stood at $2.639 billion on Nov 27. At the end of October, the reserves held by the State Bank totalled $9.778bn and the reserves held by the banking system stood at $2.475 billion.

This means that the reserves held by the State Bank saw a huge decline of $430m in 27 out of 30 days of the last month. The reserves of the central bank have fallen chiefly because it sold $400 million to the banks for making oil import payments.

The SBP had started selling dollars to the banks to pay for oil imports from November 1 to keep the rupee from falling to unmanageable lows. This helped the rupee recover 2.7pc of its lost value against the US dollar during last month.

Earlier, it had depreciated by 5.5 per cent against the US unit in July-October as trade deficit during this period increased four-fold to $1.432bn partly due to soaring oil prices in the international market and partly due to import of larger volumes of oil.