KARACHI –
Pakistan’s foreign exchange reserves took a slight hit this week, as the State Bank of Pakistan (SBP) reported a $72 million decline, bringing its total holdings down to $14.23 billion. The drop, attributed to scheduled external debt repayments, was confirmed in the latest data released by the central bank on Thursday.
Despite the SBP’s dip, foreign exchange reserves held by commercial banks remained unchanged at $5.26 billion. Combined, the country’s total liquid foreign reserves now stand at $19.5 billion.
Meanwhile, the Pakistani rupee saw a marginal improvement, appreciating by 0.04% against the US dollar in the inter-bank market. The local currency closed at Rs282.56, up Rs0.11 from the previous day’s close of Rs282.67.
Dollar Wobbles Globally Amid Fed Speculation and Political Uncertainty
On the global front, the US dollar lost ground against major world currencies, as speculation grows over a potential interest rate cut by the Federal Reserve. Lingering concerns about political interference in key US institutions further weighed on the greenback’s performance.
Investors are closely watching the US job market, especially after last week’s disappointing non-farm payroll data, which added pressure on the Fed to act. In contrast, the euro strengthened ahead of scheduled peace talks next week related to the Russia-Ukraine conflict.
Gold Soars in Pakistan Following Global Safe-Haven Rally
While currency markets reacted to uncertainty, gold prices in Pakistan soared, echoing global trends. In the local market, the price of gold per tola surged by Rs2,900, reaching a new high of Rs362,200. The 10-gram gold rate followed suit, climbing Rs2,487 to Rs310,528, according to data from the All Pakistan Sarafa Gems and Jewellers Association.
The latest jump follows a Rs1,300 increase recorded a day earlier. Internationally, spot gold hit a more than two-week high, buoyed by safe-haven demand sparked by new US tariffs imposed under former President Donald Trump and expectations of rate cuts.
Adnan Agar, Director at Interactive Commodities, said the rally reflects the ongoing global tariff tensions, particularly involving major economies such as India, Russia, Europe, and Japan.
“If gold manages a strong close above $3,400, the next resistance level could be in the $3,440 to $3,450 range,” he noted.
As of mid-morning in New York, spot gold was trading at $3,388.09 per ounce, while US gold futures had climbed to $3,455.60, according to Reuters.
China’s Gold Reserves Continue to Grow
Adding to the bullish sentiment, China’s central bank reported another rise in its gold holdings, marking the ninth straight month of purchases. According to official figures, China’s gold reserves rose from 73.90 million fine troy ounces in June to 73.96 million ounces in July, now valued at $243.99 billion.
