Foreign exchange reserves of the State Bank of Pakistan increased from less than $3 billion in February 2023 to $21.5 billion as of October 9, 2026. As The Express Tribune reports, central bank governor Jameel Ahmad told foreign investors in Bangkok that the reserve buildup was ensured by the bank’s own foreign currency purchases rather than new loans.
Reduction in liabilities
According to Ahmad, the bank’s forward foreign exchange liabilities were reduced from more than $5.7 billion to less than $1 billion. He also said that Pakistan’s external debt had increased only slightly over the past three years.
Currency purchases became possible due to a nearly balanced current account in fiscal year 2026. The central bank governor expects such operations to continue, as the current account deficit for fiscal year 2027 is projected at between 0% and 1% of GDP.
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Assessments of the economic situation
During the annual meetings of the International Monetary Fund and the World Bank on October 12–17, Ahmad held talks with representatives of JP Morgan, Citibank, Jefferies, Deutsche Bank, Barclays, Bank of America, MSCI, Standard Chartered and Mitsubishi UFJ Financial Group. He also met with bilateral and multilateral partners, other central banks and rating agencies.
Ahmad said inflation had fallen sharply compared with the high levels of fiscal year 2023 and had nearly entered the target range in 2026, despite a significant jump in oil prices. Pakistan’s real GDP growth, he said, was 3.7% in fiscal year 2026, while 3.5–4.5% is projected for 2027.
He added that Pakistan had reached a staff-level agreement with the IMF on the review of the Extended Fund Facility and Resilience and Sustainability Facility programs. In his assessment, continued reforms strengthened investor confidence, contributed to sovereign credit rating upgrades and facilitated the country’s access to global capital markets.
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