Recent forecasts for the AED to PKR exchange rate indicate a challenging landscape for the Pakistani Rupee as geopolitical tensions persist. Analysts have noted a 12% depreciation of the PKR against the US dollar since January 2025, with expectations that the rate could decline to 100 PKR/USD by year-end. This depreciation can be attributed to ongoing political tensions and border disputes, creating concerns over the stability of the PKR.
Meanwhile, the UAE Dirham has benefited from several favorable developments. The U.S. Federal Reserve's potential rate cuts, anticipated due to a softening labor market, have buoyed Gulf market sentiment, enhancing the AED's attractiveness. Furthermore, the Dirham has seen some support from a robust performance in the UAE’s economic sectors, with projections of growth in both Abu Dhabi and Dubai for 2025.
The recent data shows the AED to PKR exchange rate trading near 76.32, just 0.6% below its three-month average of 76.73. This stability is notable given the relatively narrow trading range of 1.5% from 76.19 to 77.37. In contrast, the weakening of several Asian currencies, including the PKR, against the Dirham has improved conditions for expatriates sending remittances from the UAE, suggesting that the Dirham remains strong in the current climate.
Economic policies in Pakistan, including the State Bank's interventions and ongoing reforms recommended by the IMF, aim to stabilize the currency. Nevertheless, these measures have created an environment of uncertainty. As analysts observe the interplay between geopolitical issues and central bank strategies, the outlook for the PKR remains cautious.
Overall, for anyone engaged in currency transactions between the AED and PKR, the current trends suggest maintaining a close watch on both political developments in Pakistan and economic indicators in the UAE to gauge potential shifts in the exchange rate.
