SBP range-bound reserves hit $10.7 billion

Express Tribune

03-04-2025

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State Bank of Pakistan (SBP) reserves saw a notable increase during the week ending March 28, 2025, rising by $70 million to reach a total of $10.7 billion, with commercial banks maintaining net foreign reserves of $4.9 billion.
As of March 28, 2025, Pakistan's total liquid foreign reserves stood at $15.6 billion. Meanwhile, the rupee experienced a slight dip against the US dollar, falling by 0.14% in the inter-bank market on Thursday. At the close of trading, the currency settled at 280.56, marking a decline of Rs0.40 against the greenback.
On the international front, the US dollar weakened across the board on Thursday, while the euro strengthened following US President Donald Trump's announcement of aggressive tariffs against trading partners. The tariffs, set to take effect on April 9, will target around 60 countries, including a 29% tariff on Pakistan.
Speaking to The Express Tribune, Zafar Paracha, President of the Exchange Companies Association of Pakistan, highlighted that foreign direct investment (FDI) profits, record earnings by banks and multinational companies, and profit repatriations are exerting pressure on the exchange rate. Typically, this period does not experience such pressure, especially during or after Ramazan, when remittances usually increase. In March 2025, remittances are expected to reach $3.5 billion, compared to $3.2 billion in February 2025.
Paracha also pointed out that most banks in Pakistan are foreign-owned, and payments for commercial import bills have added further strain. Regarding trade, he noted that Pakistan's exports to the US have remained stagnant at $5 billion for over 20 years. He criticised exporters for their lack of effort, describing them as overly reliant on government support instead of exploring new markets or enhancing their competitiveness.
He suggested that this is the right time to incentivise exchange companies and overseas Pakistanis to help offset the impact of US tariffs on Pakistan. He emphasised that a significant portion of remittances still flow through unofficial channels. While Pakistan has seen an average annual remittance growth of 8–10%, he believes there is potential to reach 20% growth, given that 2.5 million Pakistanis migrated abroad in the last three years, with a total overseas Pakistani population exceeding 12 million. In comparison, peer countries achieve annual remittance growth of around 20%, but Pakistan has lagged behind.
Paracha also criticised Pakistan's export strategy, stating that the country primarily exports raw materials such as rice, cotton, and fruit, without adding value or taking risks to enter new markets and build strong global brands.
Meanwhile, gold prices hit a new all-time high in Pakistan on Thursday, mirroring the rise in international rates. In the local market, the price of gold per tola climbed to Rs325,500, reflecting an increase of Rs500 in a single day, according to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA).