Pakistan’s foreign exchange reserves have climbed to $21.5 billion, while economic growth reached 3.7% in fiscal year 2025-26. The latest figures indicate improved macroeconomic stability, according to State Bank of Pakistan (SBP) Governor Jameel Ahmad.
Ahmad shared the assessment during meetings with international investors and financial institutions in Bangkok, held alongside the IMF-World Bank Annual Meetings from October 12 to 17.
Foreign Exchange Reserves Show Strong Recovery
Pakistan’s official foreign exchange reserves stood at $21.5 billion on October 9, 2026. This marks a significant recovery from less than $3 billion in February 2023.
The SBP also reduced its forward liabilities from more than $5.7 billion to below $1 billion during the period.
According to Ahmad, foreign exchange purchases by the central bank supported the recovery. An almost balanced current account in FY26 also helped strengthen the country’s external position.
Moreover, regulatory changes involving exchange companies and measures to channel remittances through formal channels improved liquidity in the interbank foreign exchange market.
Economic Growth Reaches 3.7%
Pakistan’s real GDP grew by 3.7% in FY26, following a period of economic contraction and slower activity. Inflation also declined from elevated levels in FY23 to near the SBP’s target range in FY26.
Looking ahead, the central bank expects economic growth to range between 3.5% and 4.5% in FY27. It also projects the current account deficit to remain between 0% and 1% of GDP.
However, global uncertainty and geopolitical developments continue to pose risks to the outlook.
Fiscal Position and Investor Confidence Improve
Pakistan recorded a primary fiscal surplus for the third consecutive year in FY26. Consequently, the public debt-to-GDP ratio continued its downward trend.
Ahmad also confirmed that Pakistan had reached a staff-level agreement with the IMF on reviews under the Extended Fund Facility and Resilience and Sustainability Facility.
He said continued reforms had supported improvements in investor confidence and sovereign credit ratings. Pakistan’s return to international capital markets has also expanded its financing options.
Focus Shifts Towards Sustainable Growth
The SBP governor said prudent policies and structural reforms had strengthened Pakistan’s ability to manage domestic and external shocks.
Nevertheless, sustaining these gains will require continued fiscal discipline, stronger external reserves and consistent reforms. Pakistan’s challenge now is to turn economic stabilisation into lasting growth and broader economic opportunities.
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