KARACHI: The foreign exchange reserves of the State Bank during the week ended on Aug 18 fell by $125 million to $7.93 billion, the central bank said on Thursday.

It’s the first time in five weeks that the SBP’s reserves have fallen below $8bn. During the week ended on July 14, its foregn exchange holdings jumped to $8.73bn on the back of inflows from the International Monetary Fund, Saudi Arabia and the United Arab Emirates.

The State Bank has been trying to keep the reserves at least at $8bn, for which it has been buying from the banking market.

Some currency dealers said the State Bank would manage to take the total again at $8bn by purchasing from the banking market, but any big payment would again slash the reserves. The country is bound to pay $25bn in debt servicing in the current fiscal year.

The country’s total reserves now stand at $13.25bn, including $5.32bn held by commercial banks.

Published in Dawn, August 25th, 2023