Recent forecasts and market analyses indicate a nuanced outlook for the USD to PKR exchange rate. As of now, the USD is trading at approximately 281.8 PKR, which is just below its three-month average. Market dynamics have seen the USD fluctuating within a relatively stable range of 280.6 to 284.1 PKR, reflecting a cautious sentiment among investors.
According to analysts, the US dollar gained some strength recently due to reduced bets on an imminent Federal Reserve interest rate cut, particularly as expectations for a cut in December have dipped below 50%. However, gains were tempered as investors braced for potentially disappointing economic data from the U.S., which may trigger a reassessment of Fed rate expectations. The influence of geopolitical tensions and economic data releases is expected to keep USD's momentum in check.
On the Pakistani side, the PKR has faced significant pressures, seeing a 12% depreciation against the USD since the beginning of 2025, primarily attributed to geopolitical tensions, reduced remittances, and increased trade deficits. Recent projections suggest the PKR could weaken further to around 100 PKR per USD by year-end if conditions do not stabilize. However, positive developments, such as record remittances of $38.3 billion this fiscal year and a favorable agreement with the International Monetary Fund (IMF), have provided some support to the currency. The State Bank of Pakistan has also intervened in the market to stabilize the PKR, although this action raises questions regarding sustainability.
In summary, while the USD might maintain some firmness due to shifting Fed expectations and economic sentiments, the PKR faces ongoing challenges from geopolitical issues and market fundamentals. The interplay between these factors will be crucial in determining the future trajectory of the USD/PKR exchange rate.
