Dollar Deposits in Pakistani Banks Surge to $4.7 Billion, State Bank Reports

Islamabad:The State Bank of Pakistan (SBP) has reported a significant rise in dollar deposits in the country’s banks, with the total amount now reaching $4.7 billion. This surge comes amid a notable reduction in the central bank’s foreign currency reserves due to external debt repayments.

According to the weekly statistics released by the SBP on Thursday, while the central bank’s dollar reserves saw a sharp decline due to the payment of foreign loans, the dollar deposits in commercial banks increased by a substantial $180 million in just one week.

The SBP stated that banks’ dollar deposits have now reached $4.7 billion. In contrast, the central bank’s dollar reserves have dropped by $143 million, standing at $1.171 billion as of the latest report.

However, the central bank emphasized that the increase in dollar deposits in commercial banks helped mitigate the decrease in the country’s overall foreign exchange reserves. As a result, Pakistan’s total foreign exchange reserves have risen by $372 million, reaching $16.4 billion.

This development marks a significant shift in the banking sector’s ability to manage foreign currency deposits, potentially providing a buffer for the country’s financial stability in the face of external challenges. The trend also highlights a growing reliance on local banks to manage foreign currency reserves, especially amid continuing debt repayments.