Overview
- On Monday the State Bank of Pakistan said FY2026‑27 external debt servicing will be about $21.5 billion, split roughly into $18 billion of principal and $3.5 billion of interest, with roughly $6 billion already settled or rolled over in July.
- Saudi Arabia extended a $5 billion cash deposit for three years, which the SBP says materially reduced Pakistan’s near‑term financing needs and helped lower gross servicing compared with the prior year.
- The SBP’s Monetary Policy Committee kept the policy rate at 11.5 percent, citing persistent inflation above target and heightened external risks as reasons to maintain a cautious stance.
- The bank expects stronger macro fundamentals in FY27 with GDP growth of 3.5–4.5 percent, workers’ remittances near $44 billion, goods exports about $32 billion, and foreign exchange reserves rising to roughly $20.2 billion by end‑December 2026.
- These improvements follow reserve rebuilding and a $1.8 billion balance‑of‑payments surplus in FY25‑26, but heavy reliance on official rollovers, commodity price swings and Middle East shipping risks leave the outlook fragile and could push up costs for households and businesses.