SBP Ramps Up Dollar Purchases Amid FX Market Stabilization Efforts

Administrative Measures and Incentives for FX Stability

On the administrative front, the SBP focused on both restricting outflows and incentivizing inflows:

• Controlling Outflows: The SBP maintained a tight grip on dollar outflows, particularly those linked to imports. While intended to manage the current account deficit, these controls created challenges for importers, who reported delays in accessing foreign exchange for business operations.
• Implementing Structural Reforms: Key regulatory changes were finalized, including reforms to foreign exchange companies. The SBP credited these steps with enhancing stability and transparency in the broader FX market.
• Incentivizing Inflows: To boost remittance inflows through formal channels, the SBP introduced incentive schemes, including reimbursing transfer charges. These initiatives aimed to reduce reliance on informal transfer systems such as hundi and hawala.

These measures were complemented by revisions to key chapters of the Foreign Exchange Manual—covering Exports, Imports, and Remittances. Together, these steps underscore the SBP's commitment to regulating foreign currency flows in support of macroeconomic stability and the broader economic reform agenda.