By Moaaz Manzoor

Pakistan’s total liquid foreign exchange reserves stood at $22.636 billion in the week ended May 29, 2026, with reserves held by the State Bank of Pakistan (SBP) increasing to $17.190 billion, according to data released by the central bank.

The latest weekly figures show that Pakistan’s external liquidity position improved during May, although total reserves edged down slightly from $22.647 billion in the preceding week ended May 22. The marginal decline was mainly due to a reduction in reserves held by commercial banks, which fell to $5.446 billion from $5.500 billion, while SBP-held reserves continued to strengthen.

The broader monthly trend remained positive. At the beginning of the month, in the week ended May 8, Pakistan’s total liquid foreign exchange reserves stood at $21.337 billion, including $15.867 billion held by the SBP and $5.469 billion by commercial banks. By May 15, total reserves had climbed to $22.589 billion before rising further to $22.647 billion on May 22.

Compared with the end of April 2026, the latest figures indicate a notable recovery. SBP data showed total liquid reserves at $20.804 billion at the end of April, comprising $15.851 billion held by the central bank and $4.953 billion by commercial banks. By May 29, total reserves had increased by approximately $1.832 billion, while SBP-held reserves rose by nearly $1.340 billion.

The latest figures also reflect an improvement from the close of FY2024-25, when total liquid foreign exchange reserves stood at $19.269 billion, including $14.506 billion with the SBP and $4.763 billion with commercial banks.

Monthly data show that reserves remained on an upward trajectory for most of the fiscal year before dipping temporarily in April. Total liquid reserves increased from $18.976 billion in July 2025 to $20.838 billion in December 2025, and then to $21.332 billion in March 2026, before declining to $20.804 billion in April. The weekly data for May suggest that the April setback has largely been reversed.

A similar pattern is evident in SBP-held reserves, which rose from $14.324 billion in July 2025 to $16.382 billion in March 2026. After easing to $15.851 billion at the end of April, central bank reserves rebounded strongly during May.

For financial markets, the increase in SBP-held reserves is particularly significant, as these reserves are closely monitored as an indicator of Pakistan’s external-sector strength, import financing capacity and investor confidence. The rise in central bank reserves during May also points to an improvement in the country’s foreign exchange position, even as bank-held reserves remained relatively stable.

The latest SBP data show that Pakistan entered the final week of May with foreign exchange reserves at one of their strongest levels during the current fiscal year, driven primarily by higher holdings with the central bank.

Credit: INP-WealthPk