The recent exchange rate dynamics between the UAE Dirham (AED) and the Pakistani Rupee (PKR) have been shaped by significant developments in both economies. As of October 2025, analysts highlight key factors influencing the AED, including a recent currency swap agreement between the UAE and Turkey, which aims to bolster local currency liquidity. This agreement could enhance financial transactions, potentially providing a more stable environment for the AED. Furthermore, the International Monetary Fund (IMF) has expressed a positive outlook on the UAE economy, projecting a robust GDP growth of 4.8% in 2025, which could further underpin the strength of the AED.
In contrast, the PKR has faced challenges stemming from geopolitical tensions and economic instability. Analysts report a 12% depreciation of the PKR against the US dollar since January 2025, with projections suggesting the exchange rate could soar to 100 PKR/USD by early 2026 if current trends persist. The State Bank of Pakistan's interventions, including purchasing $9 billion in foreign currency to bolster reserves, indicate efforts to stabilize the rupee. However, the underlying pressures linked to these geopolitical factors may continue to weigh heavily on the PKR.
Current market data shows the AED to PKR exchange rate hovering near 30-day lows around 76.50, slightly below its three-month average of 77. This range reflects a stable trading environment, with fluctuations contained within a 1.4% band from 76.28 to 77.37. Economists acknowledge that while short-term stability is evident, the long-term trajectory of the PKR remains uncertain due to ongoing challenges, including government reform commitments to the IMF and efforts to combat illegal currency trading.
In summary, the outlook for the AED remains relatively positive amidst supportive economic indicators, while the PKR is grappling with significant hurdles that could impede its recovery in the near term. Stakeholders are advised to monitor these developments closely, as both currencies navigate a complex landscape influenced by domestic policies and international economic relationships.
