FX clampdown boosts Pakistani rupee 6.1 percent to become September’s top currency

Customers exchange currency at a money exchange market in Karachi, Pakistan on January 26, 2023. (AFP/File)
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Updated 29 September 2023
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FX clampdown boosts Pakistani rupee 6.1 percent to become September’s top currency

  • September’s gains have almost made up for all of the rupee’s losses in August
  • Gains technically make rupee the best-performing currency in the world this month

KARACHI: Pakistan’s rupee has gained 6.1 percent against the dollar so far in September, following an official clampdown on illegal foreign exchange trade in grey and black markets by security agencies.

September’s gains have almost made up for all of the rupee’s losses in August and technically make it the best-performing currency in the world this month. The rupee hit a record low of 307.1 against the dollar on Sept. 5 but has made a sharp recovery since the country’s financial regulator and security agencies began taking action the next day to curb black market operations.

The Pakistani rupee closed 0.3 percent up in the interbank market at 287.8 per dollar on Thursday.

The crackdown on black market operators against the informal market resulted in tens of millions of dollars pouring back into Pakistan’s interbank and open markets, dealers said.

“The government’s stern administrative action against the unlawful foreign exchange dealers and hoarders in commodity markets is stabilizing the exchange rate, providing a respite to the imported inflation and easing out commodity prices,” the Finance Ministry said in its monthly report.

“The rupee has indeed performed well but this data does not reflect the sharp depreciation preceding this performance. Pakistan’s currency has been one of the worst-performing in recent years,” said Fahad Rauf, Head of Research at Ismail Iqbal Securities.

A market-determined exchange rate is a key condition for Pakistan receiving a $3 billion bailout loan from the International Monetary Fund (IMF) that was agreed in July to help avert a sovereign default.

Rauf added that the recent performance of the rupee is more of a recovery than an actual out-performance. He said the reserves situation is still far from comfortable.

On Thursday, Pakistan’s reserves clocked in at $7.637 billion, enough for less than two months’ worth of imports.

The report added that inflation is anticipated to remain high in the coming month, hovering around 29-31 percent due to an upward adjustment in energy tariffs and a major increase in fuel prices.


Pakistan, Türkiye military chiefs discuss defense cooperation amid Middle East tensions

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Pakistan, Türkiye military chiefs discuss defense cooperation amid Middle East tensions

  • Field Marshal Asim Munir reaffirms Pakistan’s commitment to deepening military-to-military ties with Türkiye
  • Turkish officials said this month they were in talks to join the Pakistan-Saudi defense alliance formed last year

ISLAMABAD: Pakistan’s top military commander, Field Marshal Asim Munir, met the Chief of the Turkish General Staff, General Selcuk Bayraktaroglu, on Friday to discuss deepening defense cooperation, as regional security concerns intensify amid the ongoing tensions in the Middle East.

The meeting comes against the backdrop of widening geopolitical uncertainty following the Gaza war, which has heightened the risk of broader regional escalation involving Iran and the United States, and as Ankara explores closer defense coordination with partners beyond NATO.

Earlier this month, Turkish Foreign Minister Hakan Fidan said Türkiye was in talks to join a defense alliance established between Pakistan and Saudi Arabia last September, signaling a possible expansion of security cooperation among key regional players.

The Turkish general called on Pakistan’s chief of defense forces at the General Headquarters in Rawalpindi, according to the military’s media wing, Inter-Services Public Relations (ISPR).

“During the meeting, besides dilating upon matters of mutual interest, prevailing regional and global security landscape, and prospects for strengthening bilateral defense and military cooperation were also discussed,” the ISPR said in a statement.

It added that both sides “expressed satisfaction on current trajectory of Pakistan-Türkiye relations while underscoring the requirement of maintaining close coordination and enhancing defense collaboration.”

Munir welcomed the support of the Turkish Armed Forces and reaffirmed Pakistan’s commitment to strengthening military-to-military ties, according to the statement.

It said that Bayraktaroglu praised the professionalism of Pakistan’s armed forces and expressed Türkiye’s intent to deepen defense cooperation through training, joint exercises and capacity-building initiatives.

Pakistan and Türkiye maintain close diplomatic, economic and defense relations, with military cooperation forming a major pillar of their partnership.

Last month, a high-level delegation of Turkish aerospace and defense manufacturers visited Pakistan to explore joint ventures, co-production and technology-sharing opportunities. In August 2025, the navies of both countries conducted their first bilateral amphibious exercise to strengthen maritime coordination.

Turkish defense firms have played a key role in modernizing Pakistan’s Agosta 90B-class submarines and have supplied Islamabad with advanced military hardware, including drones.

The two countries also regularly conduct joint military drills. Their most recent exercise, Ataturk-XIII in February 2025, brought together special forces units for combat training aimed at improving their ability to operate effectively together in the field.