REER improves to 96.6 in June
The Real Effective Exchange Rate (REER) index for the Pakistani rupee improved to 96.6 in June 2025, down from 97.8 in May 2025, according to data released by the State Bank of Pakistan (SBP). The drop in REER suggests improved external competitiveness for the rupee.
The rupee also appreciated slightly against the US dollar on Friday, gaining 0.04% in the interbank market. It closed at 284.87, up by 10 paisas from Thursday's closing rate of 284.97.
In parallel, the SBP injected Rs11.05 trillion into the banking system through Open Market Operations (OMOs) on Friday, using both conventional and Shariah-compliant instruments. The bulk came through the conventional reverse repo OMO, with Rs11.371 trillion accepted. Most of this was in the 14-day tenor (Rs11.2 trillion at 11.03%), and a smaller portion in a 7-day tranche (Rs171.1 billion at 11.09%).
Under the Shariah-compliant Mudarabah-based OMO, Rs115.5 billion was accepted, split between 7-day (Rs100 billion at 11.11%) and 14-day (Rs15.5 billion at 11.13%) tenors.
These operations reflect SBP's focus on short-term liquidity management. Rates ranged from 11.03% to 11.13%, suggesting stable interbank market conditions. The pro-rata acceptance in some tenors points to selective liquidity control to balance market needs. Analysts view the scale of the injection as a sign of adequate banking liquidity. The slightly lower OMO rates may signal a shift towards monetary easing.
Meanwhile, the APGJSA, said the price of gold per tola rose by Rs2,500 to Rs357,600 on Friday. The price of 10 grams increased by Rs2,143 to Rs306,584. A weaker US dollar and geopolitical uncertainty boosted gold's appeal as a safe-haven asset. Platinum prices, however, retreated after recently hitting a decade high.
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