SBP buys $12.4 billion to rebuild reserves, limits rupee appreciation

The State Bank of Pakistan conducted net foreign exchange purchases of $12.4 billion between June 2024 and December 2025 as part of efforts to strengthen reserves and manage exchange rate movements.

Data cited by Arif Habib Limited showed that the central bank remained active in the interbank market, including net purchases of $1.024 billion in December 2025.

The intervention pattern indicates that the central bank has primarily been absorbing dollar liquidity, marking a shift from earlier periods when it sold foreign exchange to support the rupee amid reserve pressures.

In the first half of FY26, the central bank purchased $4.15 billion from the market, reflecting sustained inflows and relative stability in the external account during the period.

Analysts said the trend points to improving balance of payments conditions, supported by higher remittances, controlled imports, and inflows linked to the IMF programme.

Officials have indicated that the purchases are aimed at rebuilding foreign exchange reserves while avoiding sharp movements in the exchange rate. The strategy involves intervening during periods of inflows to accumulate reserves and manage volatility.

Economists noted that continued reserve buildup will depend on sustained external inflows and stable macroeconomic conditions, particularly amid risks linked to global oil prices and geopolitical developments.