The total money supply circulating in Pakistan’s economy reached Rs44.84 trillion by the end of September 2025, according to the latest provisional data released by the State Bank of Pakistan (SBP). This figure reflects a steady 0.4% increase from Rs44.66 trillion reported in August 2025 and a substantial 12.42% jump compared to Rs39.89 trillion recorded during the same month last year.
The SBP’s Monetary Aggregates report highlights the evolving liquidity conditions in the economy, underscoring both the effects of monetary management and behavioral responses of the public to inflationary trends. The expansion in the money supply indicates growing transactional demand for cash and deposits, consistent with the overall increase in consumption and investment activity.
A closer look at the data shows that Rs10.48 trillion were held as currency in circulation — representing the physical cash available with the public. Despite remaining a key component of Pakistan’s monetary structure, the currency in circulation fell slightly by 0.57% month-on-month, but posted a strong 19.13% rise year-on-year. This upward annual movement reflects the continued reliance on cash-based transactions, which are still dominant in the informal sector of the economy.
Transferable deposits — encompassing all deposits that can be exchanged on demand without penalty — stood at Rs24.53 trillion in September 2025. This segment represents a major portion of the total money supply, signaling sustained confidence in the banking system’s liquidity management. The steady growth in such deposits aligns with the financial sector’s digital transformation and the expansion of online payment ecosystems that have made access to funds more efficient and immediate.
Meanwhile, other deposits, which include all non-transferable deposits held in both local and foreign currencies, were recorded at Rs6.36 trillion in September 2025. This represents a 0.9% monthly decline, but a 6.52% year-on-year increase, showing moderate growth in savings and term deposits despite volatile macroeconomic conditions.
The SBP’s data also reveals a minor rise in coins in circulation, recorded at Rs9.32 billion in September compared to Rs9.31 billion in August 2025 and Rs9.06 billion in the same period last year. Although the amount of coins in circulation remains marginal relative to total liquidity, the slight increase reflects consistent demand in small-scale cash transactions across retail sectors.
Economists note that the overall expansion in the monetary base reflects both inflationary influences and the government’s fiscal activity. The year-on-year rise in currency in circulation suggests that inflationary conditions continue to encourage cash withdrawals, as households prefer liquidity to meet rising living costs. At the same time, the sustained growth in transferable deposits underscores that digital banking channels are increasingly supporting consumer convenience and real-time financial mobility.
Analysts also view the growth in money supply as an indicator of the SBP’s balanced monetary policy approach. While inflation remains a challenge, the central bank’s efforts to maintain liquidity have supported credit flow to businesses and industries. This liquidity management strategy plays a vital role in sustaining economic recovery and enabling smoother financial transactions across sectors.
The continued rise in money supply suggests that Pakistan’s financial system remains active and resilient, supported by growing public trust in digital banking, expanding fintech services, and stable remittance inflows. However, economists caution that sustained liquidity expansion must be carefully managed to avoid fueling inflationary pressures and to ensure that growth remains within sustainable limits.
As the fiscal year progresses, the SBP’s policy stance and liquidity management will remain crucial in balancing growth and stability. The interplay between cash-based transactions and digital finance channels will continue to shape Pakistan’s evolving monetary landscape in the months ahead.
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