December 31, 2018 (MLN): Pak Rupee’s Real Effective Exchange Rate index (REER) decreased by 1.63 percent in November, falling to a value of 106.3802 from 108.1435 in October.
According to data published by the State Bank of Pakistan, the REER index has declined by 14.35 percent compared to November 2017.
Similarly the Nominal Effective Exchange rate Index (NEER) fell by 1.97 percent in November to 73.4378 from 74.9170 in October. On a yearly basis, the NEER has fallen by 18.69 percent.
The State Bank had devalued the Rupee on November 30, 2018 by 3.78 percent.
Since the round of ‘Market Driven adjustments’ began in Dec 2017, PKR has lost 31.80 percent of its value.
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 become cheaper and imports become more expensive; therefore, a decrease indicates a gain in trade competitiveness.
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