By Moaaz Manzoor

The Pakistani rupee remained broadly stable against major international currencies during the third week of June, posting a slight gain against the US dollar as improving external-sector indicators and stronger foreign exchange reserves continued to support the currency market.

According to the State Bank of Pakistan (SBP), the US dollar stood at Rs278.0267 for buying and Rs278.4518 for selling on June 15. The greenback gradually eased during the week, closing at Rs277.9714 and Rs278.3965, respectively, on June 19, reflecting a modest appreciation in the rupee.

The euro recorded comparatively larger fluctuations during the week. It opened at Rs322.5667 for buying and Rs323.0531 for selling on June 15 before declining to Rs317.6590 and Rs318.1475, respectively, by June 19. The British pound followed a similar trend, moving from Rs373.6426 for buying and Rs374.2033 for selling to Rs366.3412 and Rs366.8991 over the same period.

Regional currencies remained largely stable. The Saudi riyal edged down slightly from Rs74.0766 for buying and Rs74.1864 for selling on June 15 to Rs74.0547 and Rs74.1628, respectively, by the end of the week. The UAE dirham also showed limited movement, closing at Rs75.6742 for buying and Rs75.7814 for selling on June 19.

The Chinese yuan weakened marginally during the week, falling from Rs41.1505 for buying and Rs41.2070 for selling on June 15 to Rs41.0541 and Rs41.1076, respectively, on June 19. Meanwhile, the Japanese yen remained broadly stable, ending the week at Rs1.7226 for buying and Rs1.7252 for selling.

The rupee's relative stability coincided with continued improvement in Pakistan's external-sector position. According to Arif Habib Limited (AHL), the local currency appreciated by 0.02% week-on-week against the US dollar, supported by manageable external financing pressures and improving foreign exchange inflows.

Pakistan's foreign exchange reserves also strengthened during the period. Total liquid foreign exchange reserves increased by $70 million to $22.7 billion as of June 18. SBP-held reserves rose by $5.8 million to $17.2 billion, while commercial bank reserves increased by $64.2 million to $5.5 billion. The country's reserve position provided import cover of approximately 2.71 months.

Recent external account data further supported market confidence. Pakistan recorded a current account surplus of $459 million in May 2026, compared with a deficit of $276 million in April and a deficit of $44 million in May last year. The improvement reflected stronger inflows and continued resilience in the external sector, although the cumulative current account surplus during the first eleven months of FY26 narrowed to $255 million from $1.62 billion a year earlier.

Meanwhile, the State Bank of Pakistan kept the policy rate unchanged at 11.5% during its latest Monetary Policy Committee meeting. The decision reflected a balancing of moderating economic activity and persistent inflationary pressures against a relatively stable external-sector outlook.

Overall, the rupee's performance during the third week of June reflected a balanced foreign exchange market, supported by stronger reserve holdings, a return to a current account surplus, and stable macroeconomic conditions. While global uncertainties and inflationary pressures remain important risks, improving external-sector fundamentals helped keep currency movements within a narrow range against both major and regional currencies.

Credit: INP-WealthPk