The State Bank of Pakistan (SBP) said that the rumors regarding the foreign exchange reserves held by the central bank have dried up are not true.

The State Bank of Pakistan (SBP) said that the rumors regarding the foreign exchange reserves held by the central bank have dried up are not true. The central bank has issued a clarification via its Twitter account as it came across the rumors implying that SBP Reserves have dried up or are not usable, that SBP has stopped import payments, and that banks have run out of US$.

The foreign exchange reserves are completely usable

The SBP stated that on 10th June, it released the details of the liquid foreign reserves, which stood at $8.99 billion. It further added that those did not include gold reserves and are fully usable for all purposes. It central bank also clarified that it has not stopped import payments and that commercial banks have sufficient $ liquidity to execute these payments. Indeed, import payments of around US$ 4.7 billion have been executed through the interbank market during the month so far.

The last data released by SBP shows that the foreign exchange reserves held by the State Bank of Pakistan (SBP) have dropped by $241 million to $8.9 billion as of 10th June. Meanwhile, the foreign reserves held by the country clicked in at $14.94 billion and the reserves held by commercial banks stood at $5.96 billion. In recent months, Pakistan’s currency has become one of the worst performers in the world as it has depreciated by 14.57 percent against the dollar this year.

Read more: SBP Forex Reserves Fall to $8.9 Billion; Lowest Since November 2019

Banking sector resilient to withstand the severe economic shocks: SBP

According to the State bank of Pakistan, Pakistan’s banking sector has adequate resilience to withstand the severe economic shocks, as its capital adequacy ratio remains significantly higher than both domestic and global benchmarks of solvency in the medium term. SBP said in its Financial Stability Review (FSR) for 2021; “Stress test results show the banking sector is expected to maintain a reasonable resilience against various hypothetical adverse economic shocks over the projection period of three years.

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