Pakistan’s Real Effective Exchange Rate (REER) climbed to 108.93 in September 2026, reaching its highest level in eight years, according to Topline Securities. The latest increase highlights a continued rise in the index, which also remains above its 10-year average of 102.26.
According to data cited by Topline Securities, Pakistan’s REER increased from 107.87 in August 2026 to 108.93 in September. The latest reading indicates that the index continued its upward movement during the month.
The Real Effective Exchange Rate is an important economic indicator used to assess a country’s currency value against the currencies of its major trading partners. It accounts for exchange rates and differences in relative price levels between countries.
A higher REER generally indicates that a currency has become stronger in real, trade-weighted terms. Depending on the underlying economic conditions, this can make domestic goods relatively more expensive compared with products from other countries.
Pakistan’s September reading of 108.93 stands above its 10-year average of 102.26. This suggests that the index is elevated compared with its longer-term historical benchmark, although the figure alone does not establish whether the Pakistani rupee is overvalued.
The REER is different from the nominal exchange rate commonly quoted in currency markets. While the nominal rate measures the value of one currency against another, the REER considers a broader basket of trading partners and adjusts for differences in inflation.
The index can influence how economists assess the competitiveness of a country’s exports. When the REER rises, domestic products may become relatively more expensive in international markets if other factors remain unchanged.
For Pakistan, export competitiveness is an important consideration because the country relies on foreign exchange earnings to support imports, service external obligations, and maintain overall economic stability.
A persistently elevated REER could create challenges for exporters if domestic costs and prices rise faster than those of competing economies. Industries competing internationally may face pressure to improve productivity, reduce costs, or offer more competitive prices.
At the same time, a rising REER does not automatically mean exports will decline. Export performance also depends on global demand, energy prices, productivity, product quality, government policies, and conditions in key trading markets.
The indicator should therefore be assessed alongside other economic data, including inflation, export growth, imports, foreign exchange reserves, and movements in the nominal exchange rate.
Pakistan’s REER increase from August to September 2026 provides a useful measure of recent currency competitiveness. However, determining the broader economic impact requires examining the factors behind the movement and whether the trend continues in subsequent months.
The latest figures reported by Topline Securities place renewed attention on Pakistan’s exchange-rate competitiveness and external trade position. Businesses, investors, and policymakers may monitor future REER readings to understand how currency movements and domestic prices affect the country’s position in international markets.