Pakistan’s Real Effective Exchange Rate (REER) dropped to 102.5 in February 2026, compared to 103.3 in January 2026, latest central bank data showed on Monday.
REER measures the value of a country’s currency against a basket of trading partners. A reading above 100 suggests that the local currency is relatively overvalued compared to peer economies, while a lower reading signals improving competitiveness.
Despite the latest decline, Pakistan’s REER staying above the long-term average indicates that the rupee still carries mild overvaluation pressure.
The Pakistani rupee will likely continue to strengthen modestly against the US dollar. It closed at 279.3/$ today.