Karachi, February 7, 2025 – The Pakistani Rupee regained 10 paisas against the US dollar on Friday, benefiting from an increase in foreign exchange reserves and positive economic indicators.
The rupee closed at PKR 279.05 per dollar, improving from the previous day’s closing rate of PKR 279.15 in the interbank foreign exchange market.
Foreign Exchange Reserves and Rupee Stability
Analysts credit the slight recovery of the Pakistani Rupee to the strengthening of foreign exchange reserves, which contribute to stability in currency markets. According to the State Bank of Pakistan (SBP), its reserves increased by $46 million in the week ending January 31, 2025. The latest SBP data reveals that total foreign reserves now stand at $11.418 billion, up from $11.372 billion recorded on January 24, 2025.
This increase in foreign exchange reserves is seen as a positive development, reflecting improved liquidity management by the SBP. A higher reserve level reduces exchange rate volatility and strengthens investor confidence, ultimately benefiting the Pakistani Rupee.
Rupee Outlook Boosted by Export Growth
Currency experts predict that the Pakistani Rupee could maintain its upward trajectory, supported by strong foreign inflows and a boost in export earnings. Recent statistics from the Pakistan Bureau of Statistics (PBS) indicate a 10% growth in exports during the first seven months (July–January) of FY 2024-25.
Exports surged to $19.55 billion, compared to $17.78 billion in the same period last year. This consistent increase in exports plays a crucial role in reducing trade imbalances, strengthening the Pakistani Rupee, and enhancing overall economic resilience.
Current Account Surplus and Rising Remittances
Another major factor supporting the Pakistani Rupee is the improving balance of payments. During the first half of FY 2024-25 (July–December 2024), Pakistan recorded a current account surplus of $1.21 billion, a stark contrast to the $1.40 billion deficit reported during the same period last year.
Moreover, remittances from overseas Pakistanis have provided substantial backing to the Pakistani Rupee, soaring by 38% in the first half of FY 2024-25. The total remittance inflow reached $17.85 billion, compared to $13.44 billion in the corresponding period of the previous year.
With higher foreign reserves, a growing export sector, and strong remittance inflows, analysts remain optimistic that the Pakistani Rupee will sustain its stability in the near future.