What is the real effective exchange rate of Pakistan?
Pakistan Real Effective Exchange Rate (REER: 2010=100: Month Avg: Pakistan) was 98.8 in Dec 2023, compared with the number of 98.3 in the previous month. Pakistan Real Effective Exchange Rate data is updated monthly and averaged 123.7 from Jan 2013 to Dec 2023.
Pakistan's REER index inches up in December, stands at 98.9
Meanwhile, the Nominal Effective Exchange Rate Index (NEER) increased by 1.25% MoM in January 2024 to a provisional value of 38.41 from 37.94 in December 2023. On a yearly basis, the NEER index fell by 13.60% from the value of 44.46 in January 2023.
Long definition. Real effective exchange rate is the nominal effective exchange rate (a measure of the value of a currency against a weighted average of several foreign currencies) divided by a price deflator or index of costs.
State Bank of Pakistan. Since May 1999, Pakistan has been following a market-based flexible exchange rate system. Inter-bank rate applies to all foreign exchange receipts and payments both in the public and private sectors.
Currency Rate in Pakistan Today Open Market are US Dollar to PKR 282.20, Euro to PKR 305.00, British Pound to PKR 356.00, Saudi Riyal to PKR 75.20, UAE Dirham to PKR 76.85.
Key information about India Real Effective Exchange Rate
India Real Effective Exchange Rate (REER: 2005=100: Month Avg: India) was 113.9 in Dec 2023, compared with the number of 115.2 in the previous month. India Real Effective Exchange Rate data is updated monthly and averaged 118.3 from Apr 2004 to Dec 2023.
Pakistan revaluation (PKRV) rate is average of the yield-to-maturity on government securities traded in the secondary market and determined at the end of day.
A REER below 100 means the country's exports are competitive, while imports are expensive. Therefore, an increase indicates a drop in trade competitiveness. The situation reverses when REER stands above 100 on the index.
An increase in REER implies that exports become more expensive and imports become cheaper; therefore, an increase indicates a loss in trade competitiveness. REER data may be accessed through the International Financial Statistics (IFS) dataset portal here.
Coming back to REER calculation, a country's REER can be calculated by taking the average of the bilateral real exchange rates (RER) between itself and its trading partners and then weighing it by using the trade allocation of each partner and then adjusting it for the inflation.
What is the best exchange rate for USD in Pakistan?
| Australian Dollar | 181.73 | 182.23 |
|---|---|---|
| Swiss Franc | 316.52 | 317.02 |
| Thai Bhat | 7.76 | 7.8 |
| UK Pound Sterling | 353.37 | 354.02 |
| US Dollar | 279 | 279.5 |
This is the Pakistani Rupee (PKR) to US Dollar (USD) exchange rate history data page for the year of 2018, covering 365 days of PKR USD historical data. Best exchange rate: 0.0091 USD on 13 Mar 2018. Average exchange rate in 2018: 0.0083 USD. Worst exchange rate: 0.0072 USD on 31 Dec 2018.
A country's REER can be derived by taking the average of the bilateral exchange rates between itself and its trading partners and then weighing it using the trade allocation of each partner. The average of the exchange rates is calculated after assigning the weightings for each rate.
| Photo Credit: The International Monetary Fund (IMF) has reclassified India's de facto exchange rate regime from “floating” to “stabilised arrangement” for the period December 2022 to October 2023, while the de jure classification remained “floating” after an article IV review.
India has been operating on a managed floating exchange rate regime from March 1993, marking the start of an era of a market determined exchange rate regime of the rupee with provision for timely intervention by the central bank1 .
A high REER is a bad sign for a domestic currency. It implies that said economy is losing its trade competitiveness.
What is a good exchange rate margin?
Exchange Rate Margin
Think of it like an embedded fee. Depending on the money transfer provider you use this mark-up can range anywhere from 1.0% to 5.0%. Best practice is to choose a foreign exchange provider who tells you your conversion rate and exchange rate margin upfront.
While a strong exchange rate can have some negative effects on a country's trade (in terms of exports), it also has some advantages. For example, it can help to reduce inflation by making imported goods cheaper. It can also encourage foreign investment as the country's assets will appear more valuable to investors.
An overvalued exchange rate implies that a countries currency is too high for the state of the economy. An overvalued exchange rate means that the countries exports will be relatively expensive and imports cheaper.
A currency whose exchange rate is too high for a sustainable equilibrium in the balance of payments. With no capital movements a currency is overvalued if its exchange rate is too high to produce a balanced current account.
Nominal effective exchange rates (NEER) are calculated as geometric trade-weighted averages of bilateral exchange rates. Real effective exchange rates (REER) are derived by adjusting the NEER by relative consumer prices.
