Pakistan’s forex reserves jump $1.04 billion after IMF tranche release

Pakistan’s foreign exchange reserves surged by $1.04 billion to $11.45 billion during the week ending May 16, 2025, following the receipt of a $1.02 billion tranche from the International Monetary Fund (IMF) under its Extended Fund Facility (EFF) program.

The latest injection has pushed the country’s overall reserves to a 21-week high, while the State Bank of Pakistan’s (SBP) holdings reached a 14-week peak. Net foreign reserves held by commercial banks stood at $5.2 billion, bringing total liquid reserves to $16.65 billion.

With the increase, SBP’s reserves are now sufficient to cover more than two months of imports, easing concerns over external financing stability.

Last week, the IMF approved the second tranche of its financial support package, totaling $1 billion. "Pakistan’s policy efforts under the [EFF] program have already delivered significant progress in stabilizing the economy and rebuilding confidence, amidst a challenging global environment," the IMF said in a statement.

IMF also approved $1.3 billion climate funding, of this first tranche is expected to be released in September amounting to $216 million.

The latest funds arrive as Pakistan navigates persistent economic challenges, including inflationary pressures and external debt obligations. Analysts suggest the IMF disbursement could provide some relief as policymakers continue efforts to bolster fiscal and monetary stability.