Pakistan’s foreign exchange reserves have risen to their highest level since 2022 after fresh IMF inflows, lifting SBP reserves to $15.9 billion and easing external pressure.
Reserves Jump on IMF EFF and RSF Disbursements
Pakistan’s foreign exchange reserves have climbed to their highest level in more than three years on the back of fresh disbursements from the International Monetary Fund (IMF). According to the State Bank of Pakistan (SBP), total liquid foreign reserves reached $21.089 billion as of 12 December 2025, up $1.477 billion from the previous week.
Reserves held by the SBP rose to $15.9 billion, the highest level since March 2022 and above the December target of $15.5 billion. The central bank said its FX reserves increased by around $1.3 billion during the week, mainly due to the receipt of SDR 914 million (about $1.2 billion) from the IMF under the Extended Fund Facility (EFF) and the Resilience and Sustainability Facility (RSF).
Breakdown of SBP and Commercial Bank Reserves
The latest data show a broad-based improvement in Pakistan’s external buffers. In addition to the jump in SBP reserves, foreign exchange reserves held by commercial banks also increased, rising by $177 million to $5.202 billion during the week.
Taken together, these inflows have pushed total liquid reserves to levels not seen since March 2022, providing much-needed breathing space after several years of balance-of-payments stress.
| Item | Reserves (USD bn) | Change vs Previous Week |
| Total liquid FX reserves | $21.1 | +$1.5 |
| SBP reserves | $15.9 | +$1.3 |
| Commercial bank reserves | $5.2 | +$0.2 |
Import Cover Improves to Around Three Months
With the latest IMF inflows, Pakistan’s import cover has improved to roughly three months, a critical threshold closely monitored by markets, multilateral lenders and rating agencies. Stronger reserve adequacy eases pressure on the exchange rate and gives the authorities more space to manage external shocks.
The SBP has indicated that it expects reserves to rise further over the rest of the fiscal year, projecting that they could reach around $17.8 billion by June 2026 if planned official inflows materialise. The central bank’s ongoing foreign currency purchases from the market have also contributed to the gradual build-up, as it seeks to rebuild buffers without creating excessive volatility in the rupee.
External Debt Repayments and Financing Needs
Despite the recent improvement, Pakistan still faces a heavy external repayment schedule. According to SBP estimates, gross external debt repayments for FY26 amount to $25.8 billion. Of this, about $9.7 billion has already been paid or rolled over, leaving a net repayable amount of roughly $6.9 billion for the year, excluding any further rollovers.
This means that while higher reserves and fresh IMF inflows have reduced immediate default risks, the country’s external position will remain tight. Pakistan will continue to depend on timely disbursements from multilateral and bilateral partners, as well as successful rollover of existing deposits and loans, to comfortably meet its obligations.
Imports, Remittances and Export Headwinds
In its recent monetary policy statement, the SBP noted that imports are rising in line with improving economic activity. Workers’ remittances have remained strong, providing a steady source of foreign exchange, but exports are still facing headwinds.
This combination suggests that the current account could come under renewed pressure if export growth does not pick up or if global conditions worsen. Stronger reserves help cushion that risk in the short term, but policymakers and businesses will need to focus on boosting exports, sustaining remittances and managing non-essential imports to keep the external position on a stable path.
For now, the jump in SBP reserves to their highest level since 2022 represents a welcome reprieve. But the underlying message from the data is clear: Pakistan’s long-term stability will depend less on one-off IMF disbursements and more on consistent reforms that strengthen its export base and reduce reliance on external borrowing.
