The Pakistani rupee has strengthened against the US dollar in recent inter-bank trading, continuing a trend that has seen the currency recover from its record lows of 2023. The rupee traded at PKR 277 per dollar in the latest inter-bank session.
Factors Behind the Strength
Several factors are contributing to the rupee’s recovery: IMF support providing foreign exchange inflows, increased remittances from overseas Pakistanis, improved exports and tighter monetary policy by the State Bank of Pakistan.
Impact on Businesses
The stronger rupee is providing relief for businesses that import raw materials and equipment. It is also reducing the cost of Pakistan’s foreign currency debt servicing in rupee terms.
Remittances at Record High
Pakistan received over USD 3 billion in remittances last month alone — a monthly record. This steady inflow of foreign currency has been a key factor supporting the rupee’s value.
Outlook
Analysts are cautiously optimistic but warn that the rupee’s strength will depend on continued reform implementation, remittance levels and global commodity prices, particularly oil which Pakistan imports in large quantities.
Open Market Rates
In the open market, the dollar is trading slightly higher at PKR 280, reflecting the premium some individuals pay for immediate access to foreign currency. The gap between inter-bank and open market rates remains within the SBP’s acceptable range.
