Rupee trades above 280/$ for 1st time since Jan'24
The Pakistani rupee has once again slipped past the 280 threshold against the US dollar in the interbank market, a level last seen in January 2024. As per the latest exchange rate, the rupee closed at 280.07, reflecting a 0.04% decline on a day-on-day (DoD) basis.
The last time the rupee traded above 280/$ was in January 2024. Over the past week, the currency continued its gradual decline, losing Rs0.30 (0.11%) in the interbank market.
According to the State Bank of Pakistan (SBP), the rupee ended at 279.97/$, compared to 279.67/$ in the previous week's closing.
The currency has recorded a 0.14% depreciation month-to-date, while the calendar year-to-date decline stands at 0.54%. Since the start of the fiscal year, the rupee has weakened by 0.62%, according to AHL data.
The historical trend highlights a sharp depreciation in late 2023, followed by relative stability in mid-2024, before resuming a gradual decline. The recent depreciation signals renewed pressure on the external front, influenced by rising imports and financial outflows.
Zafar Paracha, Secretary General of the Exchange Companies Association of Pakistan (ECAP), stated that while there is some pressure on the currency market, particularly due to rising import demand and debt repayments by the SBP, the situation remains stable. He noted that December typically sees profit-taking by foreign investors, as nearly 80% of banks have foreign shareholders who repatriate profits at year-end. Additionally, import pressure has increased, but there is no cause for concern. The exchange rate movement is minimal, with a less than 1% decrease, keeping the rupee stable at around 280/$.
Paracha highlighted that remittance inflows tend to improve during Ramazan, as overseas Pakistanis send financial support to their families and contribute towards charity, zakat, and donations. Exchange companies alone are expected to contribute $600 million in inflows. He further emphasised the need for incentives for exchange companies and overseas remittances, similar to the benefits provided to exporters.
According to the SBP, workers' remittances recorded an inflow of $3.1 billion in February 2025, reflecting a 38.6% year-on-year (y/y) and 3.8% month-on-month (m/m) increase. Cumulatively, remittances reached $24.0 billion during July-February FY25, marking a 32.5% rise from $18.1 billion in the same period last year. The largest sources of remittances were Saudi Arabia ($744.4 million), the United Arab Emirates ($652.2 million), the United Kingdom ($501.8 million), and the United States ($309.4 million).
Paracha projected that remittances would rise by 10% month-on-month during Ramazan, further strengthening Pakistan's foreign exchange reserves.
"Billionaire exporters receive billions of rupees in incentives, including rebates, low-cost loans, and other subsidies, yet their contribution remains stagnant. In contrast, overseas workers, who earn an average of $250 per month, have sent over $35 billion in remittancesa figure that could double if given the same importance and incentives as exporters," he said.
Meanwhile, gold prices in Pakistan remained unchanged on Monday, with per tola holding steady at Rs306,000.
According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the 10-gram gold rate also remained stable at Rs262,345.
On Saturday, gold per tola had dropped by Rs1,000, settling at Rs306,000. The international gold price also saw no change, standing at $2,910 per ounce, including a $20 premium, as per APGJSA.
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