Forex reserves continue to amass, at $17.3 billion | Pakistan Today

Forex reserves continue to amass, at $17.3 billion

KARACHI – The country’s liquid foreign exchange reserves continue to witness an upward trend and hit the historic mark of $17.3 billion in the week that ended on January 22, the State Bank of Pakistan (SBP) has revealed.
The central bank figures show that the country’s foreign reserves sustained the upturn and swelled by $18.5 million or 0.1 percent to the historic $17.300 billion against $17.281 billion of the previous week that ended on January 15. In the case of this week as well, the country’s foreign exchange reserves hit the record peak of $17.281 billion.
During the week under review, the SBP calculated its foreign reserves at $13.739 billion were up by $82.1 million or 0.6 percent when compared with the previous week’s figures of $13.657 billion. On the other hand, forex reserves of the commercial banks have fallen from $3.624 billion to $3.561 billion, registering a decline of $63 million.
According to SBP Chief Spokesman Syed Wasimuddin, a phenomenal increase in worker remittances coupled with other foreign inflows like the Coalition Support Fund (CSF) took the country’s foreign exchange reserves to climb to the all-time high of over $17.300 billion during the week under review. The country’s external accounts are showing encouraging signs with the current account deficit showing a surplus of $26 billion during first half of the current fiscal year as compared to a deficit of $2.2 billion during the corresponding period last year.
While net foreign investment in the country during July-December 2010-11 dipped by 15.4 percent to $1.05 billion, an upward trend in workers foreign augured well for the country’s fiscal health, especially when in the context of its balance of payments. According to SBP statistics, during the first six months of FY11 the Pakistani diaspora remitted some $5.291 billion marking an increase of 17 percent over the last corresponding month.
Pakistani compatriots had sent home some $4.53 billion during the same period last year. The federal government is anticipating the foreign remittances crossing the $10 billion mark this year by June 30, 2011 given the introduction of official measures like the permitted export of foreign currencies abroad and the opening of dedicated booths at all banks amongst other measures.
The reimbursement of some $743 million by the US on account of military expenditure under the CSF is also said to have played a role in the burgeoning foreign exchange reserves. Analysts are upbeat that the transfer of further $500 to $700 million under CSF during the second half of the fiscal year will continue to bolster the country and allow it to improve its current accounts.

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