Karachi, December 10, 2024 – The Pakistani rupee witnessed a slight decline on Tuesday, depreciating by 7 paisas to close at PKR 278.05 against the US dollar in the interbank market. This marginal drop follows the rupee’s closing at PKR 277.98 a day earlier.
Currency experts attributed the rupee’s slight depreciation to increased demand for dollars due to rising import payments and corporate settlements as the quarter nears its close on December 31, 2024. However, they believe strong inflows from exports and remittances could help the rupee avoid significant devaluation in the coming days.
The State Bank of Pakistan (SBP) recently reported a robust 34% growth in home remittances during the first five months (July–November) of the fiscal year 2024-25. Remittances reached $14.77 billion during this period, compared to $11.05 billion in the same months of the previous fiscal year. This increase underscores the resilience of overseas Pakistanis in supporting the economy, providing a vital cushion for the rupee against external pressures.
Pakistan’s foreign exchange reserves have also improved, further stabilizing the rupee. As of November 29, 2024, reserves climbed to $16.62 billion, marking a weekly increase of $544 million. This rise was primarily driven by a $500 million inflow from the Asian Development Bank (ADB). The SBP’s reserves alone rose by $619 million during the week, reaching $12.038 billion, up from $11.419 billion recorded on November 22, 2024.
Analysts expressed cautious optimism about the rupee’s near-term trajectory, citing supportive factors such as remittance growth and government measures to restrict non-essential imports. These efforts have helped stabilize the balance of payments, strengthening the rupee’s position in the foreign exchange market.
Despite these positive developments, experts emphasized the importance of structural reforms to ensure long-term economic stability and a stronger rupee. Enhancing industrial productivity, diversifying export markets, and reducing reliance on short-term external debt were identified as critical steps to solidify Pakistan’s economic foundation and boost the rupee’s resilience against global economic uncertainties.
The rupee’s performance will remain a key indicator of economic stability as Pakistan navigates its fiscal challenges.