December 21, 2022 (MLN): The Real Effective Exchange Rate (REER) index was recorded at 98.84 in November 2022, showing a drop of 1.34% MoM compared to 100.18 in October 2022, the latest monthly data published by the State Bank of Pakistan (SBP) showed on Wednesday.
On a year-on-year basis, the index increased by 0.24% YoY against the value of 98.60 in November 2021.
It is pertinent to mention that the REER in the review month has significantly closed to its peak of 102.95 in April 2021.
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 fall indicates an increase in trade competitiveness.
Meanwhile, the Nominal Effective Exchange rate Index (NEER) declined by 2.5% MoM in November 2022 to a provisional value of 47.74 from 48.74 in October 2022.
On a yearly basis, the NEER index witnessed a drop of 13.73% YoY from the value of 55.35 in November 2021.
