KARACHI: Pakistan saw a notable rise in foreign investment into its treasury bills during the first 16 days of January, official data from the State Bank of Pakistan showed, reflecting strengthened investor confidence in short-term government securities.
Data released by the central bank showed foreign inflows into treasury bills totalled $114.7 million in the period, compared with $18.5 million in outflows. In contrast, Pakistan’s stock market recorded comparatively limited foreign participation, with $17 million in inflows against $61.5 million in outflows.
The overall inflow into T-bills during the first six and a half months of the current fiscal year (FY26) reached $625 million, while outflows stood at $408 million. Over the same period, the equity market posted net foreign outflows of $295 million, with $164 million in inflows and $459 million in outflows.
Financial analysts attributed the strong foreign interest in treasury bills to a relatively stable exchange rate and expectations of limited volatility in the US dollar during the early weeks of the year.
The data showed that the largest foreign T-bill inflows so far this month came from Bahrain ($48 million), followed by Singapore ($28 million), the United Arab Emirates ($15 million) and the United Kingdom ($13 million).
Treasury bill yields were cut in the latest auctions held on January 8 and January 21, with the State Bank lowering rates across tenors. Recent reductions include cuts of up to 31 basis points on one-month papers and 16 basis points on 12-month instruments.
Despite volatility in the wider economy, the central bank data suggests that short-term government securities remain attractive to international investors, even as broader foreign direct investment has lagged.
Official figures show that FDI in the first half of FY26 declined by around 43% to $808 million from $1.425 billion in the same period last year.
Economists said the divergence between portfolio and direct investment flows highlights differing investor strategies as Pakistan navigates monetary policy adjustments and structural economic challenges.
