Remittances cool to $3.6b in Sept

July, August and September all cleared $3.5 billion, at $3.63 billion, $3.66 billion and $3.59 billion, respectively. The monthly average was $3,625 million, above the FY26 full-year average of $3,465 million. The July-September quarter points to inflows of about $43.5 billion in financial year 2026-27, against $41.6 billion in FY26 and an SBP projection of around $44 billion.

"We expect remittances for FY27 to clock in at $44.7 billion," Topline Securities predicted. In September, the year-on-year growth slowed to 12.7% from 16.5% in August and 12.9% in July. May's $4.25 billion remained the monthly high.

Remittances of $3.5 billion a month are now ordinary, not a peak. Gulf leads the month. Saudi Arabia was the only large corridor to rise from August, sending $899.1 million, up 2.9% month on month and 19.7% from $751 million a year earlier.

It remained the largest source. Inflows from other GCC countries rose 4.7% to $342.1 million. Oman, Qatar and Kuwait all increased.

The UAE was almost flat at $748.5 million, down 0.2% from August and up 10.5% year-on-year. The month's softness sat in Europe, not the Gulf. Remittances from the UK fell 8.6% to $515.1 million.

EU countries fell 9.7% to $447.7 million, led by Italy ($152.9 million to $133.5 million) and Greece ($56.8 million to $48.6 million). Saudi Arabia and the UAE together accounted for 46% of September remittances. With other GCC countries, the Gulf stood at 55%.

Inside the UAE, the quarter splits. Inflows from Dubai rose 30.1% to $1.83 billion in the quarter, Abu Dhabi fell 34.5% to $331 million – even it rose in September, from $91.1 million to $104.5 million.

Dubai's remittances eased from $634.6 million to $617.5 million in September. West is where the growth is. Over the quarter, remittances from the UK rose 19.4% to $1.63 billion, the fastest among the large corridors.

Inflows from the US rose 15.5% to $931 million, after a decline in the previous year's comparison. September inflows from the US were $305.9 million, down 0.9% from August and up 13.7% year-on-year. Australia rose 9.5% in the quarter and Canada 11.7%.

The EU was slower, up 9.8% to $1.41 billion. France was the weak spot, down 4.5%. Smaller corridors grew faster: Ireland 24.4%, Japan 42.6%, and South Korea 21.9%.

The UK, EU, US, Canada and Australia accounted for about 40% of September remittances. Experts say the policy question is skilled migration and student-to-worker routes, not only Gulf labour exports. At a $3.6 billion monthly pace, remittances still do the heavy lifting on the current account.

The SBP has already credited sustained inflows for the reserves rebuild and a narrower external gap. Furthermore, the Pakistani rupee extended its marginal gains against the US dollar in the inter-bank market on Friday, closing at 277.00 after appreciating by Rs0.01.

In the previous session on Thursday, the local currency had settled at 277.01 against the greenback. In international markets, the euro was on course for its fifth consecutive weekly decline on Friday, although selling pressure showed signs of easing.

France's stabilising debt market and falling US Treasury yields helped temper the dollar's rally.

Meanwhile, gold prices in Pakistan rose, tracking gains in the international market, with the price of one tola increasing by Rs5,900 to settle at Rs440,936. Globally, gold rose for a second straight session on Friday to a one-week high, as bargain buying emerged after bullion touched a two-month low earlier this week, while traders assessed the likelihood of further US Federal Reserve rate hikes.

All-Pakistan Gems and Jewellers Sarafa Association, the 10-gram gold climbed by Rs5,058 to Rs378,031. On Thursday, gold had gained Rs600 per tola to reach Rs435,036. In the international market, spot gold rose 1.4% to $4,190.49 by 1544 GMT, heading for a weekly gain of about 1.2%.

The metal fell to a two-month low on Wednesday as a stronger dollar and rising US Treasury yields weighed on the non-yielding metal,. US gold futures for December delivery also added 1.4%, trading at $4,215.60 per ounce.

Bullion gained due to "bargain hunting at the lows, as a floor has been building in the $4,000 region," said Rhona O'Connell, Head of Market Analysis at Stone X. "It is arguable that a further Fed hike is already priced in but so is the expectation for continued official sector net purchases.

Without any Black Swan event, I find it hard to see gold breaking convincingly higher. "The US 10-year Treasury yields were off over two-decade highs hit on Wednesday. Meanwhile, silver prices in the domestic market rose by Rs144 to Rs6,512 per tola.