By Moaaz Manzoor

Pakistan’s broad money supply slightly declined in April 2026 as lower currency circulation offset continued growth in bank deposits and national savings holdings, according to data released by the State Bank of Pakistan (SBP).

The SBP data showed that the broad money supply, or M3, stood at Rs47.66 trillion in April 2026 compared with Rs47.69 trillion in March 2026. However, M3 remained higher than Rs46.67 trillion recorded in February and Rs45.16 trillion in November 2025, showing that overall liquidity in the economy remained elevated despite the marginal monthly decline.

M3 is a key measure of liquidity in the economy. It includes currency in circulation, bank deposits, national savings holdings and other liquid financial assets.

The decline in April was mainly due to a reduction in the number of notes in circulation. Currency notes circulating in the economy fell to Rs11.61 trillion in April from Rs11.91 trillion in March. However, the figure remained above Rs10.80 trillion recorded in November last year.

At the same time, bank deposits continued to grow. Transferable deposits, which include highly liquid deposits used for routine transactions and payments, increased to Rs26.54 trillion in April from Rs26.39 trillion in March and Rs24.96 trillion in November 2025.

Despite the rise in deposits, lower currency circulation slightly reduced the narrow money supply, or M1, which combines notes in circulation and transferable deposits. M1 stood at Rs38.15 trillion in April compared with Rs38.30 trillion in March.

Other deposits in the banking system, including savings and fixed deposits, also increased during the month. These deposits rose to Rs5.89 trillion in April from Rs5.80 trillion in March.

Coins in circulation remained almost unchanged at Rs9.35 billion in April compared with Rs9.34 billion in March.

The SBP data further showed that M2, which includes M1 along with other deposits and coins in circulation, slightly eased to Rs44.04 trillion in April from Rs44.10 trillion in March.

National savings holdings also continued to rise during the month. Outstanding amounts under the Central Directorate of National Savings increased to Rs3.59 trillion in April from Rs3.57 trillion in March and Rs3.55 trillion in November 2025.

Similarly, deposits held with post offices increased to Rs27.52 billion in April compared with Rs26.61 billion in March.

The latest SBP data indicate that liquidity conditions remained relatively stable in April. The decline in currency circulation softened overall money supply, but continued growth in deposits and savings instruments helped keep liquidity levels firm across the financial system.

Credit: INP-WealthPk