Forex reserves ease to $17.16bn

KARACHI: Foreign exchange reserves fell to $17.16 billion in the week ending June 4, from $17.34 billion the previous week, SBP official said on Thursday.

Reserves held by the State Bank of Pakistan (SBP) fell to $13.72 billion from $13.91 billion a week ago, while those held by commercial banks rose to $3.44 billion from $3.43 billion, said the SBP's spokesman Syed Wasimuddin.

"The fell in reserves is mainly due to scheduled debt repayments," said Wasimuddin.

Forex reserves have grown steadily thanks to higher export proceeds, as well as record inflow of remittances, hitting an all-time high of $17.95 billion during the week that ended on March 26.

Reserves have since eased slightly on debt repayments.

Remittances from overseas Pakistanis increased by 23.81 percent to over $9 billion in the first 10 months of the 2010/11 fiscal year, with $1.03 billion coming in April alone, according to the SBP.

Pakistan's current account surplus for the July-April period was a provisional $748 million, compared with a $3.456 billion deficit in the same period last year.

In April, the current account had a provisional surplus of $716 million compared with a surplus of $230 million in March.

Foreign exchange reserves were boosted in January by more than $633 million when the United States provided funds for military and logistical support for Pakistan's campaign against militants.

In May 2010, Pakistan received $1.13 billion in the fifth tranche of an $11 billion International Monetary Fund (IMF) bailout programme.

Copyright Reuters, 2011