SBP Sees Forex Reserves at $25 Billion by June 2027
The State Bank of Pakistan expects its foreign exchange reserves to grow by $3.5 billion by June 2027, taking them to $25 billion from around $21.5 billion now.
Governor Jameel Ahmad shared the projection on Monday at his post-monetary policy press conference in Karachi. The press conference followed the central bank’s decision to raise the policy rate by 50 basis points to 12 percent, a decision Feature Pakistan has already reported.
The reserves path
According to the central bank, reserves are expected to reach $23 billion by December 2026 before climbing to $25 billion by June 2027. That path implies steady gains over the next eight months, rather than a single jump.
The governor said the recovery in reserves has mostly come from dollar purchases in the market, not from new borrowing. He reminded reporters that Pakistan’s reserves had dropped below $3 billion in February 2023 before they started to recover.
Last week, SBP reserves stood just under $22 billion. The gap between that figure and the $21.5 billion cited at the press conference reflects the normal week-to-week movement in reserves, as inflows and payments change the balance.
Ahmad stressed that keeping up the pace of reserve building is important for economic stability. Larger reserves give the central bank more room to meet import payments and to smooth sharp moves in the rupee, which is why the target is treated as a stability measure as much as a headline number.
Growth forecast and the rate decision
The central bank expects the economy to grow between 3.5 percent and 4.5 percent in the current fiscal year. The governor also put exports at $32.5 billion for the year, imports at $71 billion, and workers’ remittances at $45 billion.
The rate rise from 11.5 percent to 12 percent comes amid persistent inflationary pressures, rising energy prices, and fears that geopolitical tensions could push up global commodity prices. The State Bank blamed the worsening inflation outlook and the need to keep inflation expectations in check.
That context matters for the reserves target. Higher rates can slow domestic demand and support the currency, but they also raise borrowing costs for businesses and households. The central bank is therefore balancing two goals: bringing inflation back towards its 5 to 7 percent target range, and keeping growth on track.
Risks to the projection
The reserve projection is not risk-free. The governor pointed to high global commodity prices, tighter international financial conditions, and supply constraints as factors that could affect the target.
Energy prices are the most direct risk. Pakistan imports most of its oil and a large share of its gas, so a sustained rise in world energy prices would raise the import bill and drain reserves faster than planned. A weaker export performance would have a similar effect.
On the other side, remittances have been a steady support for reserves. If inflows stay strong, and if the central bank continues to buy dollars from the market, the path to $23 billion by December and $25 billion by June looks achievable on the central bank’s own numbers.
The test will come in the monthly reserves data. Each weekly update will show whether the build-up is continuing, stalling, or reversing, and the December figure will be the first real check on the governor’s forecast.
When does the SBP expect reserves to reach $25 billion?
The State Bank expects its foreign exchange reserves to reach $25 billion by June 2027, after passing $23 billion by December 2026.
