Pakistan’s Real Effective Exchange Rate (REER) increased by 0.4 percentage points to 104.5 in April 2024, according to data released by the State Bank of Pakistan (SBP) on Friday.
According to the latest monthly data released by the central bank, the trend indicates a small increase from 104.1 recorded in March 2024.
According to Arif Habib Limited (AHL), April 2024’s REER is the highest after September 2018 (5 years, 8 months). During the ongoing fiscal year to date, REER has spiked by 19.13 percent.
The REER was at 85.6 in April last year.
It is pertinent to mention here that a REER above 100 indicates a loss in trade competitiveness with exports becoming more expensive and imports getting cheaper, while a REER below 100 means the country’s exports are competitive.
Pakistan’s current REER value of 104.5 suggests that exports offer poor returns.