State Bank of Pakistan's foreign exchange reserves plunge to nearly 9-year low

KARACHI – Pakistan’s foreign exchange reserves have further fallen to $3.7 billion, its lowest levels since February 2014, as the country’s economic crisis worsen in recent weeks.

The reserves held by the central bank have been persistently shrinking since the beginning of the current fiscal year as data issued by the State Bank of Pakistan revealed that it dropped a massive $923 million to $3.7 billion.

With the new data update, the liquid foreign reserves held by the dollar starved country stood at $9.5 billion and foreign reserves held by commercial banks stood at $5.8 billion, painting a gloomy picture of the economy as the country’s top leader approaching foreign leaders and lenders amid the panic.

The foreign exchange reserves fell to lowest in last decade as the country grapples with a severe economic crunch, striving to revive the IMF bailout programme.

Pakistan’s forex reserves stood at nearly $18 billion last year but continued to shrink as talks on the IMF ninth review remained stalled in recent months.

Lately, the US-based lender said that its mission will visit Islamabad at the end of January to continue discussions under the ninth Extended Fund Facility (EFF) review.

The country of over 220 million is battling the worst economic crisis in recent times and is in dire need of foreign aid to cut its current account deficit besides having enough reserves to pay the debt.

Pakistani rupee slumps to all-time low of 255 against dollar in inter-bank market

Amid the dilapidating reserves, and unprecedented inflation, global rating agencies cut the long-term sovereign credit rating of the South Asian nation by one notch to ‘CCC+’ from ‘B’ showing a weakening of the country’s external, fiscal and economic metrics.