New Delhi, Feb. 13 -- Pakistan drew the biggest monthly net foreign inflows into its sovereign bonds since June 2024, signalling improving investor sentiment for the market as its currency strengthens.

Net inflows in January reached $176 million, compared with withdrawals of $50 million a year ago, according to central bank data compiled by Bloomberg. Short-term bonds with a duration of one year or less drew 85% of these flows.

The shift comes as Pakistan's rupee recovers from its July low and is on pace to rise against the dollar for an eighth month. The outlook for the economy is improving and foreign exchange reserves have increased to cover more than three months of imports, following a $7 billion loan from the International Monetar...