ISLAMABAD: The State Bank of Pakistan (SBP) has reported a deficit in the current account of Pakistan for the month of December 2025. The central bank revealed this in its latest Balance of Payment data released today.
According to the SBP, Pakistan’s current account registered a deficit of $244 million in December 2025. The shortfall marked a sharp reversal from the $98 million surplus recorded in November 2025 and compared with a surplus of $454 million in December 2024.
Analysts attributed the deterioration primarily to a widening trade gap driven by higher import pressures.
During the month, Pakistan exported goods and services worth $3.7 billion, reflecting an increase of nearly 20% compared to $3 billion in November. However, imports rose to $7 billion, which significantly widened the trade deficit and placed pressure on the overall external account. Although remittance inflows provided some relief, they could not fully offset the imbalance created by trade flows.
Experts warn of continued pressure despite stronger remittances
Workers’ remittances reached $3.6 billion in December, up 13% from $3.2 billion in the previous month. Nevertheless, economists cautioned that the momentum in remittances remains insufficient to counter the impact of expanding imports and weaker export growth. As a result, the current account turned negative for the month.
On a cumulative basis, the current account posted a deficit of $1.174 billion during the first half of FY2026, compared with a surplus of $957 million in the same period last year. Head of Research at Ismail Iqbal Securities, said the deficit emerged mainly because of a sharp widening in the goods trade gap. He explained that higher imports, weaker exports, and a deterioration in the services balance outweighed strong remittance inflows.
Similarly, Head of Research at JS Global, said rising imports continued to drive external pressure despite favorable global commodity prices. He added that imports increased 12% year-on-year during 1HFY26, while exports declined 5%, keeping the trade gap elevated at $15.8 billion.
Importantly, the foreign exchange reserves of Pakistan with the State Bank of Pakistan surged to $16.2 billion this month. It demonstrated a staggering 36% year-on-year growth.
