Banks made a significant purchase of $425 million from exchange companies in June FY24, reflecting much higher inflows compared to the previous year.
“Our data shows that we sold $425 million to banks in June, which is highly encouraging,” stated Zafar Paracha, General Secretary of the Exchange Companies Association of Pakistan.
Inflows through banks and exchange companies during the just-concluded FY24 were higher compared to the previous fiscal year, when remittances had declined.
The government received $27 billion in remittances in the first 11 months of FY24, up from $25.1 billion in FY23. However, this was still lower than the $28.5 billion received in FY22.
“I estimate that exchange companies sold up to $4 billion in the interbank market during FY24, which has greatly supported Pakistan’s foreign exchange market,” added Mr. Paracha.
The State Bank of Pakistan’s reserves have improved to $9.4 billion due to inflows from donor agencies, and ongoing negotiations with the IMF have positively impacted the financial sector.
Sector experts believe that another IMF package could bring further exchange rate stability, a trend observed in the second half of FY24.
This positive outlook is likely to attract foreign investment, particularly in domestic bonds and equity markets.
After 10 years, the PSX attracted a net foreign investment of $140 million.
