Pakistan’s broad money supply, measured through M2, declined by Rs324.24 billion on a week-on-week basis to Rs44.02 trillion as of September 11, 2026, according to data released by the State Bank of Pakistan (SBP). The latest movement reflects a decline in the overall stock of money circulating through the banking system and follows a larger reduction recorded since the beginning of the current fiscal year.
Compared with the position at the end of June 2026, M2 has decreased by Rs2.44 trillion from the Rs46.46 trillion recorded at the close of the previous fiscal year. The change in broad money reflects movements in its major components, including currency in circulation and deposits maintained with banks. The latest SBP data provide a breakdown of these components and their contribution to the overall movement in the country’s money supply.
Currency in circulation increased by Rs28.24 billion during the week ended September 11, reaching Rs11.81 trillion. Despite the weekly increase, currency in circulation has declined by Rs136.31 billion during the current fiscal year compared with Rs11.94 trillion recorded at the end of June 2026. Its share in total M2 stood at 26.82% as of September 11, compared with 26.56% a week earlier and 25.7% in June 2024.
Bank deposits, meanwhile, recorded a larger decline during the week. Total deposits held with banks stood at Rs32.16 trillion as of September 11, representing a decrease of Rs350.72 billion from the previous week. On a fiscal-year-to-date basis, bank deposits have declined by Rs2.3 trillion. The deposit figures exclude inter-bank deposits, deposits held by governments and deposits belonging to foreign constituents.
Currency in circulation represents the stock of banknotes and coins held by the general public and financial institutions. Movements in this component form an important part of the overall broad money position, although changes in bank deposits can also have a substantial impact on M2. In the latest weekly data, the increase in currency in circulation was more than offset by the decline in deposits held with banks, resulting in the overall reduction in broad money.
M2 is the most widely used definition of broad money in Pakistan and captures several forms of money within the financial system. From the liability side of the banking system, M2 comprises currency in circulation, total deposits of the non-government sector, including residents’ foreign currency deposits, and other deposits held with the State Bank of Pakistan. This provides a measure of the monetary liabilities generated within the banking system.
From the asset side, broad money is measured through the combined position of net domestic assets and net foreign assets of the banking system, which includes the State Bank of Pakistan and scheduled banks. Changes in these components can influence the overall level of M2 and provide an indication of shifts in domestic financing and the banking system’s external asset position.
The latest figures show that Pakistan’s broad money stock remained below its end-June level despite the weekly rise in currency held outside banks. The Rs324.24 billion week-on-week decline brought M2 to Rs44.02 trillion by September 11, while bank deposits accounted for the largest movement among the reported components during the week. The SBP’s weekly data will continue to provide a measure of changes in money supply and the composition of monetary aggregates during fiscal year 2027.
Follow the PakBanker Whatsapp Channel for updates across Pakistan’s banking ecosystem.