Foreign exchange reserves held by the State Bank of Pakistan (SBP) surged $533 million, clocking in at nearly $4.07 billion as of June 23, data released on Monday showed.

The overall number stands at a critical level at around a month of import cover.

Total liquid foreign reserves held by the country stood at $9.34 billion. Net foreign reserves held by commercial banks clocked in at $5.27 billion.

“During the week ended on June 23, 2023, SBP reserves increased by $533 million to $4,069.9 million,” said the SBP. “This is mainly attributed to realisation of $300 million proceeds of government of Pakistan’s commercial loan.”

Last week, the foreign exchange reserves held by SBP decreased $482 million to nearly $3.54 billion.

On Friday, the International Monetary Fund (IMF) announced that its staff and Pakistani authorities have reached an agreement on policies to be supported by a $3-billion, nine-month Stand-By Arrangement (SBA).

The staff-level agreement is subject to approval by the IMF Executive Board, with its consideration expected by mid-July.

“The new SBA builds on the authorities’ efforts under Pakistan’s 2019 EFF-supported programme which expires end-June,” Nathan Porter, IMF Mission Chief to Pakistan, was quoted as saying in the press release on the day the Extended Fund Facility expired.

The development acted as a much needed relief for Pakistan and improved market sentiment.