SBP Returns to Aggressive Rupee Defense; Injects Over $2 Billion in Two Months.

The State Bank of Pakistan (SBP) has returned to an aggressive stance to defend the national currency, with foreign exchange interventions surging to a year-high during the final quarter of 2025. Recent data shows a dramatic shift from earlier months of restraint, with the central bank injecting over $1 billion into the interbank market in both September ($1,023M) and October ($1,033M) 2025. This “U-shaped” trend in market activity highlights that despite ongoing structural reforms, the Rupee remains highly sensitive to seasonal dollar demand and external economic shocks.

While these billion-dollar interventions helped stabilize the Rupee in the short term, they have also sparked a debate regarding the long-term sustainability of foreign exchange reserves. Current spending levels are significantly above the historical average, leading to questions about how long the SBP can maintain this high-volume support without drawing down precious liquid assets, which recently crossed $16 billion. As the winter season progresses, the market is closely watching whether the central bank will continue its active defense or allow the Rupee to find a new equilibrium to preserve the country’s reserve levels.