The GBP to PKR exchange rate has recently seen a slight uptick, currently at 385.5, which is just 0.7% above its 3-month average of 382.9. The currency pair has remained relatively stable, fluctuating within a 5.2% range between 372.2 and 391.5.
Analysts noted that the British pound (GBP) displayed mixed performance following the latest UK labor market data, which showed a subtle slowdown. Nonetheless, market expectations for the Bank of England's (BoE) interest rate decision remain unchanged, with a hold anticipated during the upcoming meeting. Considerations about the UK's consumer price index could potentially bolster the pound's position in the near term, especially if any surprising data emerges.
Recent forecasts indicate that both HSBC and Deutsche Bank have pushed back their predictions for BoE rate cuts due to persistent inflation concerns. HSBC now expects rates to remain steady until April 2026, while Deutsche Bank is speculating about a potential cut in December. These differing outlooks among financial institutions suggest that GBP's trajectory will closely depend on the inflation outlook and any ensuing policy decisions by the BoE.
On the Pakistani side, the rupee (PKR) has faced challenges mainly due to recent geopolitical tensions with India and domestic economic adjustments, including a recent rate cut by the State Bank of Pakistan (SBP), which aimed to address cooling inflation. While the SBP's actions have offered some support to the PKR, ongoing enforcement issues regarding black market trading have complicated its stabilization.
Global market reactions and the implications of the UK fiscal policies, including the forthcoming budget announcement, are set to influence GBP's performance. As things stand, the diverse factors impacting both currencies could lead to notable volatility in the GBP-PKR exchange rate, urging businesses and individuals engaged in international transactions to stay informed of the fluctuating dynamics.
