Currency in circulation stood at PKR 10,917 billion as of January 2, 2026, reflecting a minor weekly decline of PKR 27 billion from PKR 10,944 billion in the previous week. This small contraction contributed to a Currency in Circulation (CIC) share of 26.2% in Broad Money (M2), down 0.3 percentage points week-on-week from 26.5%.
Despite the dip, CIC recorded a strong year-to-date (FYTD) increase of PKR 283 billion and a year-on-year (Y/Y) surge of PKR 1,801 billion, underscoring sustained cash demand in the economy amid ongoing recovery efforts.
Broad Money Growth Accelerates
Overall Broad Money (M2) rose by PKR 346 billion week-on-week to PKR 41,626 billion, building on a FYTD expansion of PKR 838 billion and a robust Y/Y growth of PKR 6,012 billion. Total deposits with banks drove much of the weekly momentum, climbing PKR 367 billion to PKR 30,660 billion.
This deposit growth offset the minor CIC reduction and supported overall liquidity. Net Foreign Assets of the banking system also strengthened significantly by PKR 102 billion weekly to PKR 880 billion, with a Y/Y increase of PKR 1,351 billion, signaling improved external inflows and confidence.
Private Sector Credit Rebounds While Government Borrowing Eases
Credit to the private sector showed positive momentum, expanding by PKR 412 billion week-on-week to PKR 10,755 billion, with FYTD growth at PKR 807 billion. Conventional banking contributed PKR 152 billion weekly, while Islamic banking added PKR 259 billion.
Meanwhile, Net Federal Government Borrowings declined by PKR 66 billion to PKR 37,164 billion, primarily due to reduced borrowing from scheduled banks (down PKR 134 billion), partially offset by higher SBP borrowing (up PKR 68 billion). These trends highlight a balanced shift toward private sector activity and moderated fiscal reliance on banks.