March 4, 2019 (MLN): Rupee’s Real Effective Exchange Rate index (REER) increased by 0.88% in January 2019, inching up to a provisional value of 103.1692 from the revised value 102.2784 in December 2018.

According to data published by the State Bank of Pakistan (SBP), the REER index has declined by 10.4 percent compared to January 2018.

Similarly the Nominal Effective Exchange rate Index (NEER) fell by 0.82 percent in January to 70.2073 (provisional) from 70.7848 (revised) in December. On a yearly basis, the NEER has fallen by 16.37 percent.

PKR appreciated by 63 paisa in January 2019 compared to December 2018’s closing at 138.86.

Reer is a measure of the value of a currency against a weighted average of several foreign currencies, an increase in REER implies that exports become more expensive and imports become cheaper therefore, this increase indicates a decline in trade competitiveness.

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