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Pakistan’s current account swung into a $103 million deficit in May 2025, reversing the surplus of $47 million seen in April, according to new data from the State Bank of Pakistan (SBP).
This shift was primarily driven by a sharp increase in the country’s import bill and a simultaneous drop in exports. The trade deficit surged to $3 billion, reflecting a 52% year-on-year (YoY) rise and a 16% increase compared to April 2025, said Waqas Ghani, Head of Research at JS Global.
Despite the monthly deficit, the YoY data shows improvement. The current account deficit shrank by 56% when compared to May 2024, when the shortfall stood at $235 million.
In the broader picture, Pakistan has maintained a current account surplus of $1.81 billion during the first eleven months of FY2024–25 (11MFY25). This is a significant recovery from the $1.57 billion deficit posted in the same period last fiscal year.
A breakdown of May’s numbers shows:
- Exports (goods and services): $3.15 billion, down 15% YoY from $3.71 billion.
- Imports: $6.36 billion, up 7% YoY.
- Workers’ Remittances: $3.69 billion, a strong 13% increase compared to the previous year.
Factors Supporting Overall Recovery
Pakistan’s improved current account performance over FY25 has been supported by:
- Lower economic activity
- High inflation
- Declining interest rates
- Tighter import controls
- Gradual export growth
These combined factors have helped policymakers limit the external deficit, despite short-term fluctuations like those seen in May.
