By Moaaz Manzoor

The Pakistani rupee remained broadly stable against major international currencies during the second week of May, posting a marginal appreciation against the US dollar amid improving external-sector indicators, stronger remittance inflows, and continued support from multilateral financing.

According to the State Bank of Pakistan (SBP), the US dollar stood at 278.3963 for buying and 278.8214 for selling on May 11. The greenback gradually eased to 278.3886 and 278.8137 on May 12, followed by 278.3832 and 278.8083 on May 13. It further declined to 278.3463 and 278.7714 on May 14 before closing the week at 278.3386 for buying and 278.7637 for selling on May 15, reflecting a slight appreciation of the rupee.

The euro also remained relatively stable but weakened toward the end of the week. It moved from 327.3245 for buying and 327.8178 for selling on May 11 to 327.2736 and 327.7656 on May 12. The common currency further eased to 326.4298 and 326.9275 on May 13, followed by 326.1015 and 326.6023 on May 14 before closing at 324.1361 and 324.6291 on May 15.

Similarly, the British pound followed a downward trend during the week. It stood at 378.3566 for buying and 378.9284 for selling on May 11 before easing to 377.7656 and 378.3448 on May 12. The pound further declined to 376.8105 and 377.3884 on May 13, followed by 376.4730 and 377.0684 on May 14, before ending the week at 371.8770 for buying and 372.4518 for selling on May 15.

Among regional currencies, the Saudi riyal remained largely stable throughout the week, moving from 74.1411 for buying and 74.2489 for selling on May 11 to 74.1023 and 74.2104 by May 15.

The Chinese yuan also remained relatively steady. It stood at 40.9977 for buying and 41.0502 for selling on May 11 before closing at 40.9681 and 41.0211 on May 15.

The Japanese yen showed limited movement during the week, easing from 1.7722 for buying and 1.7748 for selling on May 11 to 1.7561 and 1.7587 by May 15.

Broader macroeconomic indicators presented a relatively favourable outlook for the rupee during the week.

According to Arif Habib Limited (AHL), the Pakistani rupee appreciated marginally by 0.03 percent week-on-week, closing at 278.61 per dollar compared with 278.70 per dollar in the previous week.

The country’s external position also received support from improving reserve levels. SBP-held foreign exchange reserves increased by $16.7 million week-on-week to $15.9 billion, while total liquid foreign exchange reserves rose by $43.2 million to $21.3 billion.

During the week, Pakistan also successfully issued its inaugural three-year Panda Bond in China worth $250 million at a coupon rate of 2.5 percent. According to AHL, the issue was oversubscribed more than five times, reflecting improving investor confidence in Pakistan’s external financing outlook.

Workers’ remittances continued to support the external account. Remittance inflows increased 11 percent year-on-year to $3.5 billion during April 2026 compared with $3.2 billion in April 2025. On a cumulative basis, remittances during the first 10 months of FY26 rose 8 percent year-on-year to $33.9 billion.

Pakistan also received a $1.3 billion IMF disbursement under the Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF) following completion of the third EFF review and the announcement of new performance criteria.

Economic activity indicators also remained supportive. Pakistan’s GDP growth for the third quarter of FY26 stood at 3.99 percent, driven by industrial growth of 4.7 percent and supported by agriculture and services sector growth of 3.0 percent and 4.2 percent, respectively.

Overall, the rupee’s performance during the week reflected relative stability, supported by improving macroeconomic indicators, IMF-related inflows, stronger remittances, and a gradual strengthening of Pakistan’s external financing position.

Credit: INP-WealthPk