On June 30, 2025, the State Bank of Pakistan (SBP) reported its foreign exchange reserves surged by $5.12 billion to $14.51 billion, exceeding the International Monetary Fund’s (IMF) $13.9 billion target for fiscal year 2024-25. This milestone, driven by China’s $3.4 billion loan rollover, reflects robust economic management.
The SBP’s reserves rose from $9.39 billion as of June 30, 2024, to $14.51 billion as of June 30, 2025, representing a $5.12 billion increase. Despite a $2.66 billion drop by June 20 due to debt repayments, inflows of $3.1 billion in commercial loans and $500 million in multilateral funding, plus China’s $3.4 billion rollover, propelled reserves past the IMF’s target. Awais Ashraf of AKD Securities noted, “This is the highest weekly increase,” covering 2.5 months of imports.
China’s Critical Support
China’s $3.4 billion loan rollover, which included a $1.3 billion commercial loan refinance and a $2.1 billion deposit extension, was pivotal, according to Mettis Global. This support, secured before the fiscal year-end, aligns with IMF requirements and eased external account pressures. Additional inflows from Middle Eastern banks ($1 billion) and multilateral lenders ($500 million) further bolstered Pakistan’s reserves, enhancing the country’s economic stability.
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The reserve surge reflects improved current account management, with a $1.86 billion surplus in the first nine months of FY25, compared to a $1.65 billion deficit in the same period last year, according to EBC Financial Group. Higher remittances, exports, and IMF-guided policies, including $6.8 billion in SBP interbank purchases, supported this growth. Mohammad Sohail of Topline Securities highlighted on X that disciplined fiscal measures and a flexible exchange rate drove the recovery, averting a 2023 default crisis.
