The recent outlook for the EUR to PKR exchange rate suggests a complex interplay of factors influencing both the euro and the Pakistani rupee. The euro (EUR) has seen upward movement, supported by weakness in the US dollar and expected policy divergence between the European Central Bank (ECB) and the US Federal Reserve. Analysts note that the euro has recently traded near 30-day highs around 329.1 PKR, which is just above its 3-month average. With the euro exhibiting a stable range of 3.8%, its performance has been influenced by broader market trends alongside external economic indicators.
In the Eurozone, current inflationary pressures appear to be stronger than previously anticipated. Recent reports highlighted an uptick in inflation to 2.2%, which may influence the ECB’s monetary policy, potentially leading to sustained interest rates. This development indicates a stabilizing monetary environment, which could bolster the euro against other currencies, including the PKR. Analysts are watching how the ECB's stance evolves in light of these inflationary trends, with implications for currency strength.
Conversely, the Pakistani rupee (PKR) faces significant challenges. Geopolitical tensions have led to a substantial depreciation against the US dollar of about 12% since January 2025. Some predictions suggest it may weaken further, reaching an approximate value of 100 PKR/USD by year-end. The State Bank of Pakistan’s interventions, such as buying dollars to enhance reserves, have provided temporary support but may not be sustainable given the underlying economic conditions. The effectiveness of IMF-backed reforms could play a crucial role in stabilizing the PKR moving forward.
Current market data indicate that the EUR to PKR exchange rate has remained stable amidst fluctuating oil prices, which are currently at 30-day lows around 61.20 USD, impacting both currencies indirectly. The volatility in oil prices creates additional uncertainty, particularly for the PKR, as Pakistan's economy is sensitive to energy costs.
In summary, while the euro's outlook appears supported by solidifying economic indicators in the Eurozone, the PKR's trajectory may continue to face downward pressure amid domestic and geopolitical challenges. Stakeholders should remain vigilant to developments that could impact these currency valuations in the coming months.
