KARACHI: Despite massive decline in forex reserves, the State Bank of Pakistan feels that its reserves would be adequate to meet all forex obligations. The SBP's second quarterly report revealed that despite a current account surplus of $218 million in the first half of FY13 against a deficit of US $2.4 billion in H1-FY12, the country's foreign reserves has witnessed massive decline.
Pakistan's foreign exchange reserves fell by US $1.4 billion from their end-June 2012 level, to US $13.86 billion by the end of December 2012. This fall was entirely in SBP reserves, driven by the repayments to the IMF loan, the report said. The fall in reserves has occasionally exerted pressure on the Rupee-Dollar parity, coinciding with monetary policy decisions and IMF repayments. "We, however, feel that even with scheduled repayments to the International Financial Institutions (IFIs), SBP's forex reserves would be adequate to meet all forex obligations,", it added.