The exchange rate forecast for the AED to PKR has been influenced by a set of geopolitical and economic trends over the past two months. Following the military conflict between Israel and Iran in June, analysts noted increased volatility in Middle Eastern markets, which has led to fluctuations in the value of the UAE Dirham (AED). This geopolitical tension has resulted in rising oil prices, potentially supporting the AED against the PKR.
Economic growth forecasts for the UAE remain positive, with the Arab Monetary Fund projecting a robust growth rate of 6.2% for 2025. This expansion is driven by sectors such as tourism, real estate, and international trade. However, the recent slowdown in the UAE's non-oil private sector growth raises concerns about the sustainability of this growth, particularly for those businesses dependent on diversification efforts.
On the other hand, the Pakistani Rupee (PKR) faces challenges stemming from the U.S. imposition of a 29% tariff on goods from Pakistan, which could negatively impact the country’s trade balance and economic outlook. Additionally, rising geopolitical tensions, notably the recent airstrikes by India, have created uncertainty in the region. Despite these challenges, remittances from Pakistani migrant workers have surprisingly remained strong, providing some support to the PKR.
The current exchange rate for AED to PKR stands at 77.29, reflecting a minor increase of 0.7% above its three-month average of 76.79. This stability indicates limited volatility, with the rate trading within a narrow range of 76.17 to 77.62. Forecasters suggest that while the AED may maintain its strength due to improving economic indicators, external factors such as regional tensions and trade dynamics will be critical to watch in influencing the AED-PKR exchange rate going forward. Decision-makers and those engaged in international transactions should remain attentive to these evolving geopolitical and economic landscapes, as they could lead to significant shifts in exchange rates.