Karachi, February 25, 2025 – The Pakistani rupee experienced a slight decline against the dollar on Tuesday, closing lower by one paisa due to rising demand for foreign payments.
The rupee settled at PKR 279.67 per dollar by the end of the trading session, compared to the previous day’s closing rate of PKR 279.66 in the interbank market.
Currency analysts observed that the rupee came under pressure throughout the day as the demand for the dollar increased. This surge in demand was largely attributed to import payments and corporate transactions, which created temporary fluctuations in the rupee-dollar exchange rate. Despite the minor depreciation, market participants noted that the rupee remained relatively stable due to sustained economic support measures.
Despite the slight drop, experts maintain an optimistic outlook on the rupee’s future performance. They believe that the rupee will remain stable in the coming days, supported by improving foreign exchange reserves and a steady inflow of remittances. The rupee has shown resilience in recent weeks, benefiting from increased foreign inflows through export earnings and remittance transfers from overseas workers.
According to the State Bank of Pakistan (SBP), the country’s total foreign exchange reserves recently saw an increase of $85 million. As of February 14, 2025, Pakistan’s net forex reserves stood at $15.948 billion, up from $15.863 billion a week earlier. The SBP’s own reserves also rose by $35 million, reaching $11.202 billion from $11.167 billion in the prior week. This increase in reserves is a crucial factor in stabilizing the rupee-dollar exchange rate and reducing volatility in the currency market.
Another major factor impacting the rupee’s performance is the country’s current account balance. Pakistan recorded a cumulative current account surplus of $682 million during the first seven months of FY2024-25 (July–January). However, January 2025 saw a current account deficit of $420 million, marking the first monthly shortfall since July 2024. This was a 4% rise from the $404 million deficit recorded in January 2024, primarily due to higher import payments, which increased demand for the dollar and exerted pressure on the rupee.
Nonetheless, there are positive indicators for the rupee’s stability. A 32% rise in remittances during the first seven months of the fiscal year has significantly bolstered foreign exchange reserves, providing crucial support to the rupee-dollar exchange rate. Additionally, a 10% increase in exports, reaching $19.55 billion, has helped narrow the trade deficit, further strengthening the rupee’s position in the currency market.
With these economic trends, financial experts expect the rupee to maintain a steady trajectory, provided there are no major external shocks impacting the dollar’s availability or demand. The central bank’s continued efforts to manage forex reserves and ensure currency stability are key to maintaining a balanced rupee-dollar exchange rate in the coming months.
