Mar 17, 2021 (MLN): Pak Rupee's Real Effective Exchange Rate Index (REER) decreased by 1.05 percent in January 2021 to a provisional value of 95.32 from a provisional value of 96.33 in December 2020.
According to data published by the State Bank of Pakistan (SBP), the REER index has decreased by 1.18 percent compared to January 2020.
Similarly the Nominal Effective Exchange rate Index (NEER) decreased by 0.63 percent in January to a provisional value of 58.25 from a provisional value of 58.62 in December. On a yearly basis, the NEER Index has decreased by 7.23 percent.
PKR closed January at 160.1011 against the USD showing a depreciation of 0.17 percent compared to its value in December 2020. However, Compared to January 2020 PKR had depreciated by by 3.63 percent.
REER is a measure of the value of a currency against a weighted average of several foreign currencies, a decrease in REER implies that exports have become cheaper while imports become more expensive therefore, this decrease indicates an increase in trade competitiveness.
