Pakistani Currency Set to Break Seven-Year Downtrend Against US Dollar
Pakistan’s foreign exchange reserves have reached over $12 billion, while the current account has recorded a surplus for three consecutive months
KARACHI: The Pakistani rupee (PKR) is set to break its seven-year-long losing streak against the US Dollar, marking a significant recovery for the country’s currency. As of December 6, 2024, the PKR’s interbank rate stood at Rs278.009 to the Dollar, showing a 1.39% gain over the year and a remarkable 10.5% improvement from its all-time low of Rs307.01 in September 2023.
This turnaround follows a period of relative stability, with the rupee maintaining low volatility for over 260 days. Despite minor fluctuations, the PKR has remained steady, gaining ground against the Dollar amid improving economic conditions.
Several factors have contributed to the rupee’s recovery, including an extended IMF loan program, a crackdown on illicit Dollar outflows, a surge in exports, and growing foreign reserves. Additionally, steady remittances from overseas Pakistanis and a market-determined exchange rate have helped stabilize the currency.
Pakistan’s foreign exchange reserves have reached over $12 billion, while the current account has recorded a surplus for three consecutive months. Remittances have seen a 32% increase compared to the previous year, further bolstering the country’s economic position.
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International credit ratings agencies, including Fitch Ratings and Moody’s, have recognized Pakistan’s economic improvements, upgrading the country’s long-term credit ratings. Meanwhile, inflation has slowed to 4.9% in November, its lowest rate since 2018, thanks to falling oil prices and a favorable economic outlook.
Despite ongoing political challenges and external uncertainties, Pakistan’s currency is on track to finish the year strong, marking a potential end to its long-standing downtrend against the US Dollar.
