Pakistan central bank chief says country ready for investment boom after economic stability

Pakistan’s central bank governor has told foreign investors the country is ready for an investment boom after achieving macroeconomic stability over the past two years.

State Bank of Pakistan (SBP) Governor Jameel Ahmad, who is in the US to attend the IMF-World Bank meeting, has met with senior executives from global financial and investment institutions, including JP Morgan, Standard Chartered, Jefferies, Barclays, Citibank, Bank of America Securities, and major credit rating agencies, an official statement said.

Ahmed briefed the participants on Pakistan’s macroeconomic stability achieved due to prudent monetary policy and sustained fiscal consolidation efforts.

He said the stage “is now set for the next phase of revival in investment and economic growth”.

Ahmad told foreign investors that headline inflation has declined sharply over the past two years, reaching 5.6% in September. The core inflation has come down significantly from over 22% to less than 8%.

He said even with the impact of the recent floods, the headline inflation is expected to stabilize within its target range of 5-7% in the medium term.

Regarding the external account, the governor said Pakistan’s forex reserves have increased as a result of fiscal and administrative steps.

He said the SBP has made the forex market more transparent through structural reforms in exchange companies and promotion of remittances through formal channels.

The central bank has made a “strategic purchase” of $20 billion during the last three years from the interbank market to build its forex reserves, which have increased around five times since February 2023. He also shared that SBP is targeting to increase forex reserves to $17.5 billion by June 2026.

On debt management, Ahmad said Pakistan’s public sector external debt increased only marginally since June 2022.

The governor also stressed that economic growth recovered to 3% during FY25.

While recent floods have moderated the overall growth outlook for FY26, real GDP growth for FY26 is expected to remain within the projected range of 3.25-4.25% — higher than FY25.