The State Bank of Pakistan (SBP) is expected to allow a gradual depreciation of the Pakistani rupee in the coming months to ease pressure on the country’s current account as economic growth resumes. This projection comes from Fitch Ratings, a leading global credit rating agency, which anticipates further weakening of the currency in its latest outlook.
According to Fitch, the rupee is likely to fall to 285 against the US dollar by the end of June 2025, with a further decline projected to reach 295 by the end of the fiscal year in 2026. This forecast was presented by Krisjanis Krustins, Director for Asia Pacific sovereign ratings at Fitch, during a recent webinar. The ongoing depreciation trend reflects broader economic adjustments as Pakistan navigates challenges in maintaining a stable balance of payments amid rising growth.
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So far in 2025, the Pakistani rupee has depreciated by approximately 0.7 percent, positioning it among the weaker currencies in the Asian region, based on data from Bloomberg. The gradual weakening is viewed as a policy tool to support external stability while managing inflation and foreign exchange reserves.
The State Bank of Pakistan has not officially responded to the forecast, but Fitch suggests that the central bank is actively considering both monetary tightening and currency flexibility. “We understand that the state bank is reasonably concerned about that,” Krustins noted, highlighting that SBP’s strategy involves maintaining higher interest rates for an extended period alongside controlled currency depreciation to address macroeconomic pressures.
These developments indicate that Pakistan’s monetary authorities are prioritizing a balanced approach to sustain economic recovery while safeguarding against external vulnerabilities, with exchange rate adjustments being a key element of this strategy.
