Alam Zeb Khan
ISLAMABAD: With the unending political unrest, continuous price hike and no optimistic signals from the IMF, foreign reserves of the SBP are going down further with the latest updates showing another decline of $245 to $5.57b. The reserves in commercial banks also witnessed a slight decline and were recorded at $5.84b.
Last Thursday’s updates showed a huge decline in State Bank’s foreign exchange reserves by $294 million to $5.8 billion, which was the highest decrease in the last eight years making it even more challenging for the country to repay foreign debts.
The recent decline of $245m made the situation further worrisome, despite the fact that Finance Minister Ishaq Dar has repeatedly assured that Pakistan will not default including in his last day press conference with several ministers.
However, the foreign reserves are repeatedly falling for the last couple of weeks creating a question mark to the claims of the finance minister.
Meanwhile, reserves in the commercial banks had also witnessed a slight decline, and reserves in the commercial banks had fallen from $5.88b to 5,84b. However, the reserves in the SBP suffered more pressure.
Experts on Foreign Exchange Reserve fall
Meanwhile, the financial experts disagree with the finance minister and suggested immediate measures to be taken. They are worried about the current instability to the exchange rate and the continues falling of the local currency against the dollar.
Dollar is traded in the inter-bank at Rs 226 to Rs 227 while in the open market, it can hardly be available at Rs 245. According to experts, the significant difference has made the situation difficult and has encouraged the trade of dollars through illegal means.
Experts suggest that the government should expedite the talks with the IMF to settle the issue of releasing the next tranche and should also take immediate assistance form friendly countries, otherwise the country might face more severe financial crises in the days to come.
