Karachi, January 31, 2025 – The Pakistani rupee posted a marginal gain of 2 paisas against the US dollar on Friday, despite persistent demand for foreign payments in the interbank market.
The rupee closed at PKR 278.95 per dollar, slightly improving from the previous day’s closing of PKR 278.97, reflecting a subtle strengthening in the local currency.
Currency analysts attribute this modest appreciation to steady inflows from export receipts and remittances, which provided some support to the rupee. However, they also noted that the local currency remained under pressure throughout the trading session due to declining foreign exchange reserves and mounting import payment obligations.
Pakistan’s foreign exchange reserves declined by $137 million during the week ending January 24, 2025, primarily due to external debt repayments and other foreign liabilities. This decline underscores the country’s ongoing financial obligations amid ongoing efforts to stabilize the economy.
According to the latest figures released by the State Bank of Pakistan (SBP), the country’s total forex reserves fell to $16.052 billion, down from $16.189 billion recorded a week earlier on January 17, 2025.
Despite these short-term economic pressures, some promising indicators suggest potential long-term stability. One notable development is Pakistan’s improving balance of payments. During the first half of FY 2024-25 (July-December 2024), the country recorded a current account surplus of $1.21 billion, marking a significant reversal from the $1.40 billion deficit in the corresponding period of the previous year. This shift signals progress in economic reforms and could boost investor confidence in the financial markets.
Furthermore, remittance inflows from overseas Pakistanis have provided crucial support to the nation’s economy. During the first half of FY 2024-25, remittances surged by 38%, reaching $17.85 billion, compared to $13.44 billion in the same period last year. These remittances play a vital role in sustaining Pakistan’s foreign exchange reserves, mitigating external financial pressures, and contributing to a more stable exchange rate outlook.
While challenges remain, policymakers and analysts remain hopeful that sustained remittance growth, improved fiscal management, and economic reforms will fortify Pakistan’s financial standing in the coming months.