The State Bank of Pakistan’s (SBP) foreign reserves increased by $5 billion to reach $14.51 billion by the end of FY25, surpassing the International Monetary Fund’s (IMF) target of $13.9 billion.
This achievement is the result of coordinated efforts between the SBP and the federal government, which implemented effective macroeconomic policies and secured timely external inflows to stabilise the external sector.
Provisional data released on Wednesday showed that the SBP’s foreign reserves rose by $5.12 billion during the past fiscal year, up from $9.39 billion on June 30, 2024.
This surge is attributed to significant foreign inflows received in recent weeks, including $3.1 billion in commercial loans for the Government of Pakistan and over $500 million in multilateral funding, which provided a substantial boost to the country’s foreign exchange reserves.
SBP Governor Jameel Ahmed had earlier projected that despite high external debt servicing, the SBP’s reserves would exceed $14 billion by the end of FY25.
Economists suggest that this surge is a sign of strengthening macroeconomic fundamentals, driven by an improved current account balance, rising remittances, and disciplined fiscal management. The inflows are expected to bolster confidence in Pakistan’s economic recovery and support efforts to maintain external stability and promote sustainable growth.
However, the SBP’s reserves had dropped by $2.657 billion in the week ending June 20, 2025, due to external debt repayments. Despite this, the SBP successfully managed to maintain its reserves, aided by the over $5 billion in inflows received later in the week.
On the flip side, Pakistan is expected to witness a net outflow of $31.13 billion in foreign currency assets due to maturing external loans, deposits, and securities, according to the latest liquidity risk report released by the SBP.
The projected outflows are categorised based on residual maturity. The largest component of these maturing obligations—worth $19.23 billion—is scheduled to mature in the period spanning over three months to up to one year. This window represents the highest liquidity risk for the external account in the near term.
In the immediate future, an outflow of $8.36 billion is anticipated within the next 30 days, while another $3.54 billion is expected to mature within the one-to-three-month horizon.
These outflows underscore the challenges facing Pakistan’s external sector, particularly the importance of timely rollover of bilateral and multilateral loans, effective debt reprofiling, and continued access to foreign inflows, including through multilateral lending and market-based sources.
