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Pakistan’s Forex Reserves Plunge by $118 Million in First Week of 2022

Pakistan’s liquid foreign reserves witnessed an outflow of $118 million in the first week of 2022 that ended on January 7, 2021, according to the State Bank of Pakistan (SBP).

The central bank’s weekly report released on Thursday revealed that the country’s total liquid foreign exchange reserves went down on January 7, 2021, to $23,9 billion. SBP’s reserves fell by $88 million to $17.59 billion during the week under review, compared to $17.68 billion on December 31.

Meanwhile, the net foreign reserves held by the commercial banks amounted to $6.303 billion, depicting a decline of $29 million on a weekly basis.

Overall, the liquid foreign currency reserves held by the country, including net reserves held by banks other than SBP stood at $23.901 million, down $118 million on a week-over-week basis.

Foreign exchange reserves continue to take big hits over rising inflationary concerns observed at domestic and global levels.

Globally and in advanced economies, inflation has been rising at its highest ever rate since 2008. Given the rapid spread of the Omicron variant, the COVID-19 pandemic will continue to disrupt global economic activity in the near term. The slowdown is expected to coincide with a widening divergence in growth rates between advanced and emerging or developing economies.

Meanwhile, the Pakistani Rupee (PKR) reversed gains against the US Dollar (USD) in the interbank market on Thursday. It depreciated by 15 paisas against the greenback and closed at Rs. 176.38 after the local exchange succumbed to the intraday threat of value shredding.

Source: Pro Pakistani