The State Bank of Pakistan (SBP) purchased a net $863 million from the interbank foreign exchange market in July 2026, continuing its foreign currency purchasing activity at the beginning of the new fiscal year. According to data released by the central bank, net foreign exchange intervention increased from $841 million in June 2026, representing a month-on-month rise of $22 million. The latest figures indicate that the SBP continued to make net purchases from banks operating in the interbank market, following several months of fluctuations in its intervention activity. These transactions form part of the central bank’s foreign exchange operations and provide an indication of its net purchases and sales in the formal currency market. The July figure also follows substantial net purchases recorded during fiscal year 2025-26, when the SBP accumulated $8.1 billion through its interbank foreign exchange interventions.
The monthly data show that the SBP’s net foreign exchange purchases varied considerably during the months leading up to July. In April 2026, the central bank recorded net purchases of $635 million from the interbank market. The amount subsequently declined to $154 million in May before increasing sharply to $841 million in June. July’s net purchases of $863 million extended that recovery, exceeding the previous month’s figure by $22 million. These movements demonstrate that the scale of the central bank’s intervention has not remained constant, with monthly totals reflecting changes in its net foreign exchange transactions. The figures measure the difference between foreign currency purchases and sales rather than the total value of transactions conducted during each month. Consequently, the reported amount provides a measure of net intervention rather than the overall volume of foreign exchange traded in the interbank market.
During FY26, which covered July 2025 through June 2026, the SBP recorded net foreign exchange purchases of approximately $8.1 billion, based on the monthly intervention data. This accumulation represented the combined result of its transactions across the interbank foreign exchange market during the fiscal year. The monthly figures show that the central bank recorded particularly large net purchases during several periods. The highest reported monthly net purchase was $1.033 billion in October 2025, followed by $1.024 billion in December 2025 and $1.023 billion in September 2025. These figures indicate that the SBP’s purchasing activity exceeded $1 billion in each of those three months. The distribution of purchases across the fiscal year also highlights the importance of examining monthly movements rather than relying solely on the annual total to understand the pattern of intervention.
The SBP’s net foreign exchange intervention is defined as outright and swap purchases of foreign exchange minus outright and swap sales to and from banks in the interbank foreign exchange market. Outright transactions involve the direct purchase or sale of foreign currency, while swap transactions involve foreign exchange exchanges structured for different settlement dates. By combining these transactions and subtracting sales from purchases, the central bank calculates the net amount of foreign currency acquired through its intervention activity. This definition is important when interpreting the published data because gross purchases alone would not show the extent to which the SBP also sold foreign exchange during the same period. A positive net figure means purchases exceeded sales, while a negative figure would indicate that sales exceeded purchases over the period being measured.
Foreign exchange intervention is one of the indicators used to assess developments in Pakistan’s formal currency market. Net purchases can contribute to the central bank’s foreign currency holdings, although the effect on reported reserves also depends on other foreign currency inflows, outflows, valuation changes and transactions. The July figure of $863 million therefore records the SBP’s net intervention in the interbank market and should not automatically be interpreted as the monthly increase in total official foreign exchange reserves. Reserve movements reflect a wider range of factors, including external debt repayments, government transactions and foreign currency receipts. The distinction is relevant as Pakistan continues to monitor its external financial position and manage foreign currency requirements associated with imports and international payments.
The latest intervention data also provide context for the SBP’s broader efforts to strengthen Pakistan’s external position. Governor Jameel Ahmad recently stated that the central bank expects foreign exchange reserves to rise to $23 billion by December 2026 and $25 billion by June 2027, compared with approximately $21.5 billion at the time of his remarks. He attributed much of the recovery in reserves to dollar purchases from the market rather than borrowing. However, the reserve projections remain dependent on the balance between foreign currency inflows and external payment requirements. Continued purchases in the interbank market may support reserve accumulation when market conditions permit, but the actual outcome will also depend on export earnings, remittances, financing inflows, imports and debt servicing.
The increase in net purchases from $841 million in June to $863 million in July indicates that the SBP maintained a substantial level of net foreign exchange intervention at the start of FY27. The broader FY26 total of $8.1 billion, together with the monthly peaks recorded in September, October and December 2025, illustrates the scale of the central bank’s purchasing activity over the preceding fiscal year. Nevertheless, monthly intervention figures alone do not establish the reasons behind each movement or indicate the precise effect on the rupee’s exchange rate. The data provide a record of net transactions conducted through the interbank market, offering a useful reference for tracking the SBP’s foreign exchange operations as Pakistan continues to manage its reserves, currency market conditions and external financing needs.
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