Pakistan’s REER Inches Up to 100.1 in August 2025

Karachi – Pakistan’s Real Effective Exchange Rate (REER) stood at 100.1 in August 2025, slightly higher than 100.0 in July, according to the latest data released by the State Bank of Pakistan (SBP).

The index posted a month-on-month increase of 0.09%, signaling relative stability in the rupee’s inflation-adjusted value against a basket of trading partners.

Fiscal Year & Calendar Year Trends

• On a fiscal year-to-date (FY26TD) basis, the REER has risen 2.11%, reflecting a strengthening trend so far in FY26.

• On a calendar year-to-date (CY25TD) basis, however, the index remains down 3.44%, showing depreciation pressures earlier in the year.

What REER Indicates

The REER is an important gauge of external competitiveness. It measures the country’s currency value relative to its trading partners, adjusted for inflation.

• A REER above 100 generally suggests the currency may be overvalued.

• A REER below 100 implies it may be undervalued, potentially boosting exports but increasing import costs.

✅ Key Highlights:

• REER at 100.1 in Aug 2025 (up from 100.0 in July).

• +0.09% MoM growth.

• +2.11% FY26TD, but -3.44% CY25TD.

• Above 100 = possible overvaluation; below 100 = undervaluation.