Pakistan’s external sector rebounds with $1.88bn current account surplus  

ISLAMABAD: Pakistan’s economy appears to be finding its footing again with the current account posting a surplus of $1.88 billion during the first ten months of FY24-25, a major improvement from last year’s deficit.

Remittances from overseas Pakistanis rose sharply by nearly 31 per cent, reaching $31.2bn between July and April. Most of the inflows came from countries like Saudi Arabia, the UAE, the US, the UK and others in the GCC and Europe. Analysts say better exchange rates, improved economic conditions abroad, and stronger use of official channels helped boost these figures.

Inflation, one of the biggest worries for households over the past year, eased significantly. Average inflation dropped to 4.7 per cent in July–April, compared to a painful 26 per cent during the same period last year. In April alone, the consumer price index rose just 0.3 per cent while food prices actually fell especially in rural areas.

The rupee also gained some strength, appreciating by 1.81 per cent against the US dollar to settle at Rs278.8. Meanwhile, foreign exchange reserves improved, reaching $15.6 billion by early May, helped by the IMF’s latest loan disbursement of over $1 billion under its Extended Fund Facility. 

On the industrial front, there was a modest recovery. The sector grew by 4.8 per cent, bouncing back from last year’s contraction, thanks in part to a rebound in electricity, gas, and construction activity. Still, large-scale manufacturing remained under pressure, shrinking by 1.5 per cent, which hints at continued challenges for the country’s factories.

The services sector grew by 2.9 per cent, lifted by gains in information technology, finance, and public administration. 

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