Saudi Riyal's Performance Against Pakistani Rupee in July 2025 and Outlook for August
- By Web Desk -
- Jul 31, 2025
The Saudi Riyal (SAR) exhibited notable fluctuations against the Pakistani Rupee (PKR) throughout July 2025, reflecting a dynamic interplay of market forces, remittance inflows, and trade dynamics. Starting the month at Rs75.63 on July 7 and peaking at Rs76.36 on July 22, the Riyal closed the month at Rs75.52 on July 31, according to data from currency dealers and the State Bank of Pakistan.
This analysis examines the Riyal’s performance, its drivers, economic impacts, and implications for Pakistan’s economy, leveraging data from daily exchange rate reports.
Performance Trends
The Saudi Riyal’s value against the Pakistani Rupee in July 2025 showed a general upward trend with periods of stability and brief declines:
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Early July (July 7–15): The Riyal started at Rs75.63 on July 7, rising steadily to Rs75.90 by July 15, a 0.36% increase. This upward movement was driven by consistent remittance inflows from Saudi Arabia, which contributed $913.3 million in May 2025, and seasonal demand linked to trade activities.
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Mid-July Peak (July 16–22): The Riyal peaked at Rs76.36 on July 22, a 0.60% increase from July 15 and a 1.00% gain from July 7. This high was fueled by robust remittance flows and market demand, reflecting confidence in the Riyal’s dollar-pegged stability.
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Late July Adjustments (July 23–31): The Riyal experienced a notable decline to Rs75.46 by July 29, a 1.17% drop from its peak, before stabilizing at Rs75.46 on July 30 and slightly rising to Rs75.52 by July 31. These adjustments likely stemmed from market corrections and fluctuations in remittance supply, though the Riyal remained above early July levels.
The Riyal’s selling rate followed a similar pattern, peaking at Rs77.03 on July 22 and closing at Rs76.09 on July 31, maintaining a consistent spread over the buying rate.
Key Drivers of Performance
Several factors influenced the Saudi Riyal’s performance against the Pakistani Rupee in July 2025:
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Remittance Inflows: Saudi Arabia remained Pakistan’s largest source of remittances, with $913.3 million recorded in May 2025 and a cumulative $34.9 billion from July 2024 to May 2025, a 28.8% year-on-year increase. These inflows, driven by millions of Pakistani workers in Saudi Arabia, consistently supported the Riyal’s demand and value.
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Market Dynamics: Seasonal demand, trade activities, and market adjustments played a significant role. The Riyal’s dollar peg ensured its stability, making it a reliable currency for trade, particularly for oil and petrochemical imports, which bolstered its value during peak demand periods.
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Macroeconomic Factors: Pakistan’s foreign exchange reserves, which surpassed $11 billion in October 2024, were supported by remittance inflows, helping stabilize the Rupee. However, fluctuations in the Riyal-PKR rate reflected market responses to inflation pressures and trade balance dynamics.
Economic Impacts
The Saudi Riyal’s performance had significant implications for Pakistan’s economy:
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Household Income: The Riyal’s fluctuations directly affected remittance-dependent households. At its peak of Rs76.36, 1,000 Saudi Riyals converted to Rs76,360, compared to Rs75,520 at the month’s close on July 31. This variability impacted purchasing power for essentials like education and healthcare, with higher rates providing greater relief amid rising living costs.
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Trade Balance: The Riyal’s strength increased import costs for goods like oil, straining Pakistan’s trade deficit. The slight decline to Rs75.46 by July 29 offered marginal relief, though the overall high rates maintained pressure on import expenses.
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Foreign Exchange Reserves: The Riyal’s robust performance supported Pakistan’s reserves, aiding inflation control and debt management. The stability and occasional upticks in the Riyal-PKR rate helped maintain reserve levels, critical for economic resilience.
Comparative Analysis
The Riyal’s performance in July 2025 showed a net gain of Rs0.29 (0.38%) from July 7 (Rs75.63) to July 31 (Rs75.52). Despite the late-month decline, the Riyal remained stronger than its early June rate of Rs75.59, indicating sustained market confidence. The volatility, with a high of Rs76.36 and a low of Rs75.46, reflects typical currency market adjustments but underscores the Riyal’s overall stability due to its dollar peg and strong remittance backing.
Outlook for August 2025
Looking ahead, the Saudi Riyal is likely to maintain its critical role in Pakistan’s economy, driven by continued remittance inflows and trade with Saudi Arabia. Traders and policymakers should monitor market dynamics closely, as even minor fluctuations can impact remittances, import costs, and economic planning. The Riyal’s dollar peg will likely keep it resilient, but any shifts in remittance patterns or global oil prices could influence the Riyal-PKR rate. For millions of Pakistanis, the Riyal’s reliable value will remain a financial lifeline, supporting economic stability.