Pakistan's foreign-exchange reserves have retreated sharply from their early-July high, with State Bank of Pakistan holdings falling by USD229 million to USD17.03 billion in the week ended July 24 as external debt repayments again exposed the volatility of the country's reserve position. Total liquid foreign reserves stood at USD22.44 billion on July 24, comprising USD17.03 billion held by the central bank and USD5.41 billion with commercial banks. The latest decline followed a modest increase of USD33 million in the preceding week, when SBP reserves rose to USD17.26 billion by July 17. The recent pattern has been one of abrupt gains and equally sharp reversals. At the start of the new financial year, Pakistan's total liquid foreign reserves had climbed to nearly USD24 billion after government-related inflows lifted the central bank's holdings by USD1.944 billion in a single week.

During the week ended July 3, SBP reserves rose to USD18.47 billion, while commercial banks held USD5.52 billion. Total liquid foreign exchange reserves consequently reached USD23.99 billion. That increase marked a considerable improvement from the previous week, when total reserves had stood at USD22.04 billion. Of that amount, USD16.53 billion was held by the central bank and USD5.52 billion by commercial banks. The July surge, however, proved temporary. Subsequent external debt repayments pulled official holdings lower, illustrating how quickly headline reserve gains can be eroded when large foreign-currency obligations fall due. The central bank's reserve movements over recent months have been shaped less by steady accumulation than by sizeable external transactions. Earlier, SBP reserves had increased by USD611 million during the week ended June 24 to USD16.53 billion, mainly because of inflows from multilateral institutions. That rise itself followed a USD1.305 billion decline linked to external debt re payments.

The central bank had previously recorded a series of smaller weekly gains, including increases of USD6 million, USD25 million, USD43 million and USD66 million. One of the largest recent additions came in the week ended May 15, when SBP reserves increased by USD1.214 billion to USD17.08 billion. That increase was supported mainly by funds received from the International Monetary Fund under the Extended Fund Facility and the Resilience and Sustainability Facility, as well as proceeds from a Panda bond issuance. External debt repayments were also made during the same period. Earlier weekly gains included increases of USD17 million and USD23 million, while another USD730 million rise was largely attributed to proceeds from Pakistan's Eurobond issuance.

Taken together, the reserve data show an external buffer that has strengthened through periodic inflows from the government, multilateral lenders and international bond markets, but which remains vulnerable to repayments. By July 17, Pakistan's total liquid foreign reserves stood at USD22.67 billion. SBP holdings had increased by USD33 million to USD17.26 billion, while commercial banks held about USD5.41 billion. A week later, the central bank's reserves slipped back to USD17.03 billion, reducing total liquid holdings to USD22.44 billion. The contrast with the beginning of July is pronounced. In less than a month, total reserves had moved from almost USD24 billion to about USD22.44 billion, while SBP holdings fell from USD18.47 billion to USD17.03 billion. That does not erase the gains made through official and multilateral inflows, but it highlights the fragile arithmetic of reserve accumulation. Large receipts can improve the external position quickly, yet debt servicing can reverse part of that improvemen t almost as fast. For policymakers, the latest figures therefore offer a mixed picture: Pakistan still holds a considerably larger foreign-exchange cushion than during periods of acute external stress, but the recent swings show that maintaining it depends heavily on the timing of fresh inflows and external repayments.