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KARACHI: The foreign exchange reserves of the State Bank are inching close to the target of $18 billion for current fiscal year (FY26), but a widening trade deficit threatens to erase the growth in reserves and remittances.
Data issued by the central bank on Thursday showed that the forex reserves increased by $43 million to $17.2bn during the week ending on May 29.
Financial experts see the improvement in reserves as a good sign, but at the same time they fear the widening trade imbalance would lead to a large current account deficit this fiscal year.
They also pointed out that substantial payments to foreign creditors are due this month.
