Exchange companies in Pakistan sold $248.7 million to banks in August, up 30 percent from $174.9 million a year earlier, signaling an improvement in foreign currency inflows, according to data from the Exchange Companies Association of Pakistan.
The August gain followed a weaker July, when exchange companies sold $230.7 million to banks, down from $290.6 million in the same month last year.
Despite concerns over the impact of the Gulf conflict on Pakistan’s external inflows, remittances have so far remained resilient. However, reports that Pakistani workers could be sent back from Gulf countries have raised concerns about the potential impact of a prolonged regional conflict on future inflows.
Malik Bostan, chairman of ECAP, said foreign currency inflows had started improving as the situation in Kashmir normalized. He said inflows during July and August could have been about $50 million higher if political disruptions in Kashmir had not affected activity.
ECAP has also formally requested the State Bank of Pakistan to restore internet access across Kashmir, Bostan said. Partial internet access has already been restored, he added.
Exchange companies collectively sold $479.5 million to banks during the first two months of fiscal year 2026 27, compared with $465.5 million during the same period of the previous fiscal year.
Pakistan is targeting remittances of $44 billion in fiscal year 2026 27, compared with $41.5 billion received during fiscal year 2025 26. Currency market participants, however, remain concerned about the longer term impact of the regional conflict on Gulf economies and Pakistan’s foreign exchange inflows.
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