Dollar Likely to Rise

By Naveed Ullah Baig

Pakistan’s currency is once again under pressure, and it is becoming clear that the rupee may weaken further in the coming months. There may not be any formal announcement of devaluation, but the ground reality is already moving in that direction.

One major reason is the rise in global oil prices. Since Pakistan depends heavily on imported fuel, higher oil costs mean more demand for dollars. This directly puts pressure on the rupee and pushes the dollar rate upward.

At the same time, rising domestic inflation is also playing a key role. As prices continue to increase across the country, it not only affects people’s purchasing power but also adds further pressure on the currency. Inflation and currency weakness are closely linked, and when one rises, it often leads to pressure on the other.

On the policy side, Pakistan is under a program with the International Monetary Fund, where the exchange rate is expected to remain market-driven. This limits the government’s ability to control the rupee. The State Bank of Pakistan also has limited room to support the currency due to reserve and debt pressures.

So even if we don’t see a sudden drop, the rupee is already on a gradual downward path.

The reality is simple, the dollar is not just rising, it is becoming stronger, and the rupee is adjusting under that pressure.