Pakistan’s Actual Efficient Alternate Fee (REER) eased to 103.73 in December 2025, indicating a slight moderation within the rupee’s relative valuation, although it stays above the 10-year common of 103.0, in keeping with market knowledge reported by Topline Securities.
REER measures the worth of a rustic’s foreign money towards a basket of buying and selling companions, adjusted for inflation differentials. A studying above 100 means that the native foreign money is comparatively overvalued in comparison with peer economies, whereas a decrease studying alerts bettering competitiveness.
Regardless of the decline, Pakistan’s REER staying above the long-term common signifies that the rupee nonetheless carries delicate overvaluation stress towards main buying and selling companions.
Trying forward, Topline expects the Pakistani rupee to strengthen modestly towards the US greenback, forecasting the PKR/USD price to shut under Rs. 285 by June 2026.
Market members say the outlook will depend upon sustained international inflows, secure remittance progress, managed imports, and continued coverage self-discipline underneath Pakistan’s ongoing financial reform framework.
An extra decline in REER towards its long-term common may assist enhance Pakistan’s commerce competitiveness whereas holding inflationary pressures in test, analysts added.