Karachi, May 22, 2025 – The Pakistani rupee continued to edge lower on Thursday, closing at PKR 282.06 against the US dollar in the interbank foreign exchange market.
This marks a depreciation of 9 paisas from the previous day’s closing rate of PKR 281.97.
Currency analysts attribute the rupee’s recent dip to heightened dollar demand stemming from import-related and corporate sector payments. They explained that such pressure on the rupee is common in the lead-up to Pakistan’s federal budget, as importers rush to bring in consignments early to avoid potential new taxes and duties. This behavior typically amplifies dollar demand in the interbank market, weakening the rupee.
Despite this mild downturn, the rupee has shown relative stability in recent weeks, largely supported by favorable economic signals and sustained dollar inflows. One significant contributor to the rupee’s resilience was the disbursement of $1.023 billion from the International Monetary Fund (IMF) under its Extended Fund Facility (EFF) on May 13. This inflow came after a $131 million increase in Pakistan’s foreign exchange reserves during the week ending May 9, reinforcing the rupee’s standing in the interbank exchange environment.
On the macroeconomic front, Pakistan has reported a noteworthy turnaround in its external account. From July to April of the current fiscal year, the country posted a current account surplus of $1.88 billion. This represents a sharp reversal from the $1.34 billion deficit recorded during the same period last year. The improvement is largely credited to a 31% surge in workers’ remittances, which reached $31.2 billion, along with a 6.25% rise in exports—both developments providing critical support for the rupee in its battle against dollar strength in the interbank market.
Nevertheless, concerns remain. The trade deficit has expanded by 8.81% to $21.35 billion, primarily driven by a 7.37% increase in imports. This has added further strain on the rupee, particularly in the interbank market where dollar availability remains under pressure.
Experts maintain that continued support from the IMF, coupled with strong remittance inflows and consistent export performance, should help the rupee maintain relative stability against the dollar through the fiscal year-end.