Karachi, March 26, 2025 – The Pakistani rupee gained 16 paisas against the US dollar on Wednesday, driven by renewed confidence from the International Monetary Fund (IMF) regarding Pakistan’s economic outlook.
The rupee closed at PKR 280.26 per dollar in the interbank market, improving from the previous day’s rate of PKR 280.42.
Currency analysts attributed this appreciation to the recent staff-level agreement reached between Pakistani authorities and the IMF. The agreement, once approved by the IMF Executive Board, is expected to unlock approximately $2 billion in inflows, strengthening Pakistan’s foreign exchange reserves and providing much-needed relief to the rupee.
Over the past few days, the rupee faced downward pressure due to significant dollar outflows related to import payments and corporate transactions. The ongoing demand for dollars in trade settlements and foreign debt obligations strained the local currency, raising concerns among investors about its long-term stability.
However, a surge in remittances from overseas Pakistanis ahead of Eid helped cushion the rupee’s fall. Expatriates sending funds to their families for holiday expenses provided temporary relief, increasing the supply of dollars in the market. Despite this support, experts warn that once the Eid season passes, remittance inflows could decline, leaving the rupee exposed to renewed depreciation pressures.
Pakistan’s foreign exchange reserves have seen a modest increase, though not enough to fully stabilize the rupee. The State Bank of Pakistan (SBP) reported a rise of $187 million in total liquid foreign exchange reserves over the past week. As of March 14, 2025, the reserves stood at $16.016 billion, up from $15.929 billion a week earlier. The SBP’s own reserves also grew by $49 million, reaching $11.147 billion. Nevertheless, persistent dollar outflows continue to challenge the rupee’s strength.
Looking ahead, financial experts predict further fluctuations in the rupee’s value, particularly after Eid, when import bills and external debt repayments increase. The widening current account deficit, coupled with Pakistan’s reliance on dollar inflows to meet trade and debt obligations, could place additional strain on the rupee. Without strategic measures such as restricting non-essential imports and attracting foreign investments, the rupee may struggle to sustain its gains in the coming weeks.