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In March 2024, Pakistan’s Real Effective Exchange Rate (REER) surged by 1.97 percentage points to reach 104.07, as per data disclosed by the State Bank of Pakistan (SBP) on Monday.
The latest monthly figures from the central bank demonstrate a rise from 102.10 noted in February 2024.
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March 2024 marks the highest REER since April 2021, almost three years prior, when it stood at 104.2. During the period from February to June last year, the REER ranged between 85 and 90.
It’s worth noting that a REER surpassing 100 signifies a decline in trade competitiveness, as exports become more expensive and imports cheaper. Conversely, a REER below 100 indicates competitive exports. With Pakistan’s current REER at 104.07, it implies that exports yield unsatisfactory returns.