Pakistan's trade deficit narrowed by 15.22% month-on-month (MoM) to $3.95 billion in July 2026, supported by a sharp recovery in exports and a slight decline in imports, according to provisional data released by the Pakistan Bureau of Statistics (PBS).

The monthly improvement was driven by a 31.09% increase in exports, which climbed to $2.94 billion in July from $2.24 billion in June. Meanwhile, imports edged down 0.17% to $6.89 billion, compared with $6.90 billion in the previous month.

The strong rebound in exports, coupled with relatively stable imports, helped reduce the monthly trade gap from $4.66 billion in June to $3.95 billion in July.

Despite the monthly improvement, the trade balance remained weaker compared to the same period last year. On a year-on-year (YoY) basis, Pakistan's trade deficit expanded by 25.17% from $3.15 billion recorded in July 2025.

Exports increased 9.54% YoY, rising from $2.68 billion in July last year, while imports grew at a faster pace of 17.99%, reaching $6.89 billion from $5.84 billion.

The stronger growth in imports relative to exports continued to keep pressure on Pakistan's external account, despite the notable month-on-month improvement in the country's trade performance during July.