The exchange rate forecast for the UAE Dirham (AED) against the Pakistani Rupee (PKR) presents a mixed picture as of December 2025. Recent developments indicate that the AED has been gaining strength, largely bolstered by ongoing expectations of U.S. Federal Reserve rate cuts, which have positively influenced Gulf markets. Analysts note that as the U.S. dollar strengthens, it contributes to the AED's stability and value, particularly favorable for expatriates engaging in remittance activity.
The current exchange rate of AED to PKR is at a 90-day low of 76.33, slightly below the 3-month average of 76.84. This suggests relative stability, with trading remaining within a narrow band of 1.4% over the past quarter. Market experts attribute this range-bound behavior to the weakening of various Asian currencies, including the Pakistani Rupee, which has come under pressure from geopolitical tensions and economic instability.
The PKR has seen a significant depreciation against the USD, dropping approximately 12% since the beginning of 2025. Forecasters predict that it could reach 100 PKR per USD by the end of the year, highlighting a challenging environment for the PKR. Central bank interventions, notably the State Bank of Pakistan's significant purchases of U.S. dollars to shore up reserves, offer temporary support but may not address the underlying pressures faced by the currency.
In summary, while the AED is currently strong against the PKR, sustained geopolitical tensions and economic challenges in Pakistan create headwinds for the PKR's outlook. The data suggests that those engaged in exchanges between these currencies should remain vigilant to changing market dynamics, as developments in U.S. interest rates, regional political stability, and economic policies continue to play crucial roles in shaping future trends.
