Karachi, May 21, 2025 – The Pakistani rupee showed a marginal weakening on Wednesday, edging closer to the 282 mark against the US dollar at the close of trading in the interbank foreign exchange market.
The rupee closed at PKR 281.97 per dollar, compared to the previous day’s rate of PKR 281.92, reflecting a five-paisa depreciation.
This minor slide continues the pattern of cautious volatility observed in recent sessions, primarily influenced by shifting dollar demand dynamics within the interbank market. According to currency analysts, the slight decline in the rupee’s value stems from heightened dollar demand among importers and corporate entities. Many are rushing to fulfill payment obligations ahead of the new fiscal year, which has created added strain on the rupee.
The looming announcement of the federal budget for FY2025–26 has added an element of uncertainty to the foreign exchange market. Traders have adopted a conservative stance as they anticipate possible policy changes that could affect the rupee-dollar equation in the coming months.
Despite this recent depreciation, the rupee has largely maintained a stable trajectory in recent weeks. This resilience is underpinned by positive economic developments and robust dollar inflows. A key stabilizing factor was the receipt of $1.023 billion under the IMF’s Extended Fund Facility (EFF) on May 13. This inflow followed a $131 million uptick in Pakistan’s foreign reserves during the week ending May 9, strengthening the rupee’s position in the interbank sphere.
Pakistan’s external sector has also posted encouraging numbers. Between July and April of the current fiscal year, the country recorded a current account surplus of $1.88 billion, a stark contrast to the $1.34 billion deficit in the same period last year. This turnaround was supported by a 31% jump in workers’ remittances, totaling $31.2 billion, and a 6.25% increase in exports—both of which contributed to stabilizing the rupee against the dollar.
Nonetheless, challenges persist. The trade deficit has widened by 8.81% to $21.35 billion, mainly due to a 7.37% rise in imports, continuing to pressure the rupee in the interbank market where dollar demand remains elevated.
Experts believe that, with continued IMF backing, consistent export growth, and strong remittance inflows, the rupee is likely to remain relatively stable against the dollar through the rest of the fiscal year.