Pakistan’s current account is once again under pressure. Following an exceptional current account surplus of USD 2.1 billion in FY2025, the account slipped back into deficit during the first two months of FY2026. Although the deficit—USD 624 million—is relatively small, it sends a strong signal. The earlier surplus was never considered sustainable, so its reversal comes as no surprise.
In the first two months of FY2026 (July–August), goods imports on a payments basis stood at USD 10.4 billion, marking a 9% increase compared to the same period last year. Exports also rose by 10%, reaching USD 5.3 billion.
During this two-month period, the goods trade deficit widened to USD 5.1 billion, while the overall balance of goods and services reached a negative USD 5.8 billion. The primary income account saw further outflows of USD 1.5 billion, partially offset by inflows in the secondary income segment—mainly workers’ remittances, which amounted to USD 6.8 billion.
The headline surplus seen last year has now fully dissipated, reflecting the ongoing structural vulnerabilities in Pakistan’s external account.
