Karachi August 19 2023: The REER index was recorded at 91.58 in July 2023 as compared to 87.72 in June 2023 slipped by 390 basis points, according to data published by State Bank of Pakistan.
This represents the most steepest REER index drop since October 2022 and ranks as the third highest in history based on data available from the Central Bank.
Interestingly, during the month of July 2023 Pak rupee depreciate 0.5 percent to close the month at 286.33, as per official data of SBP. Due to this fall on REER index Pakistan Rupee lost 3.2 percent during the month of August 2023 so far.
Note: A REER index of 100 should not be misinterpreted as denoting the equilibrium value of the currency. 100 merely represents the value of the currency at a chosen point in time (in this case the average value of the currency in 2010). Therefore, movement of the REER away from 100 simply reflects changes relative to its average value in 2010 and is unrelated to its equilibrium value.