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Forex reserves decline

Business

May 29, 2020

KARACHI: Pakistan’s foreign exchange reserves declined to $18.597 billion in the week ended May 21 from $18.618 billion a week ago, the central bank reported on Thursday.

The foreign exchange reserves held by the State Bank of Pakistan (SBP) fell $55 million to $12.073 billion due to external debt repayments.

The foreign exchange reserves of commercial banks; however, stood at $6.524 billion. That compared with $6.489 billion in the previous week.

Meanwhile, the rupee ended weaker due to rising dollar demand from importers and corporates and the lack of greenback sales by exporters, dealers said.

In the interbank market, the local unit closed at 161.98 against the dollar, 0.65 percent, or 1.06 paisas, lower than the previous closing of 160.92.

The rupee lost 80 paisas to end at 161.80 against the greenback in the open market.

Dealers said the currency was under renewed pressure weighed by increased demand for the dollars and weak supplies. “Some companies and importers bought dollars to meet their payments that put pressure on the rupee,” a foreign exchange dealer with a leading commercial bank said. “We were expecting that the currency would see some decline after it resumed trading activity.

The financial markets remained closed from May 22 to May 27 for Eid holidays.

“We expect the rupee to lose further grounds in the coming sessions, owing to persistent dollar demand in the market,” the dealer added.