Current account posts $356m deficit in September

October 16, 2026 (MLN): Pakistan’s current account deficit widened to $356mn in September from a revised $73mn in August, and a reversal from the $133mn surplus recorded in September last year, taking the first-quarter (July-September) FY27 deficit to $874mn, 15.8% wider than the $755mn a year earlier, according to Balance of Payments data released by the State Bank of Pakistan (SBP).

The widening reflects a goods trade gap that keeps growing as imports outpace exports, with workers’ remittances and other secondary income cushioning only part of the pressure.

The first-quarter deficit is already about 2.2 times the $391mn recorded for the whole of FY26.

The deficit on goods, services and primary income combined widened to $12.48bn in 1QFY27 from $10.82bn a year earlier. Secondary income of $11.61bn offset most of it.

Goods imports rose 14.3% year-on-year to $17.78bn in 1QFY27, while exports grew a slower 7.7% to $8.45bn.

That pushed the goods trade deficit 21.1% wider to $9.33bn.

Goods exports rose 22.9% month-on-month in September to $3.02bn, but imports climbed 13.0% to $6.17bn from $5.46bn in August.

The monthly goods deficit widened 4.9% to $3.16bn.

It was 30.4% wider than the $2.42bn recorded in September last year, as imports rose 22.7% year-on-year against a 15.5% rise in exports.

Services offered little relief. The services deficit was $281mn in September, up from $274mn in August and $155mn a year earlier.

For the quarter, however, services exports rose 22.8% to $2.72bn, which kept the cumulative services gap marginally narrower at $831mn.

Combined, the goods and services deficit was $3.44bn in September, up 4.7% from August and 33.5% from a year ago.

Workers’ remittances reached $10.88bn in 1QFY27, up 14.0% from $9.54bn a year earlier.

September inflows of $3.59bn were up 12.7% year-on-year but 1.9% lower than August’s $3.66bn.

Secondary income rose 15.4% to $11.61bn in the quarter.

The September figure of $3.87bn was almost flat on August’s $3.89bn but 14.2% higher than a year ago.

The primary income deficit, which mainly reflects profit repatriation and debt servicing, stood at $792mn in September, up 16.6% from August and 16.0% from a year earlier.

For the quarter, the deficit edged up 2.1% to $2.32bn, as primary income debit fell slightly to $2.56bn while primary income credit dropped 22.8% to $244mn.

The financial account recorded net inflows of $4.66bn in September, up from $329mn in August, which took the 1QFY27 (July-September) total to $4.16bn, against $726mn in the same period last year.

Portfolio investment was the main driver. In September, portfolio investment in Pakistan saw a net inflow of $2.87bn, almost all of it in debt securities at $2.89bn, while equities saw a small outflow of $25mn.

For 1QFY27 as a whole, portfolio investment in Pakistan turned to an inflow of $2.93bn from an outflow of $631mn a year earlier, with debt securities accounting for $2.96bn and equities a net outflow of $28mn.

September’s inflow therefore made up nearly all of the quarter’s total.

Net direct investment inflows stood at $217mn in September, up 34.8% from $161mn a year earlier but 31.5% lower than $317mn in August.

Over 1QFY27, net direct investment inflows rose 28.9% to $714mn, led by a 20% increase in direct investment in Pakistan to $720mn.

Other investment recorded a net inflow of $1.58bn in September, against a $29mn outflow in August.

Deposit-taking corporations took on $1.74bn in net liabilities during the month, compared with a $211mn net reduction in August.

The general government made net repayments of $240mn in September, as amortization of $617mn outpaced disbursements of $314mn, with repayments of other long-term loans at $577mn and IMF repayments at $40mn.

For 1QFY27, other investment saw a net inflow of $517mn, against $809mn a year ago.

Deposit-taking corporations took on $728mn in net liabilities over the quarter, compared with $168mn a year earlier.

The general government made net repayments of $663mn over the quarter, against net incurrence of $381mn last year.

Quarterly disbursements slipped 2.5% to $1.23bn, while amortization more than doubled to $2.08bn from $946mn.

Repayments of other long-term loans rose to $1.60bn from $724mn, and IMF repayments rose to $206mn from $122mn.

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