Karachi, August 12, 2026 — The US Dollar (USD) is trading close to its interbank rate of PKR 277.6605 in Pakistan’s open market, with the latest cash quotation at Rs277.74.
The narrow difference between the two rates provides a clear reference for businesses, remitters, travelers, and individuals dealing in dollars. The interbank figure reflects official dealings released by the State Bank of Pakistan, while the open market responds more directly to everyday cash demand and liquidity conditions.
The US Dollar remains the most widely used foreign currency in Pakistan because of its many practical roles. It serves as the primary medium for international trade and imports, especially oil, machinery, and industrial goods priced in dollars. Large numbers of Pakistanis buy dollars for travel abroad, education expenses, and medical treatment overseas. Families and investors also hold dollars as a hedge against inflation and currency fluctuations, viewing it as a relatively stable store of value.
Remittances arriving in dollars from overseas workers further fuel demand, while businesses and individuals use it for savings, portfolio diversification, and settling foreign contracts. These multiple uses keep the dollar the benchmark currency against which other exchange rates are often measured.
The Iran war, which intensified from late February, disrupted energy markets through pressure on the Strait of Hormuz and drove sharp rises in oil prices at various stages, prompting risk-off flows into the US dollar. Import-dependent Asian currencies such as the Indian rupee, Indonesian rupiah, and Philippine peso faced pressure from higher energy costs, inflation risks, and capital outflows. Pakistan’s rupee showed relative resilience for much of the period, helped by Saudi financial inflows and deposits that supported reserves and limited depreciation despite the external shock. Oil-price spikes fed imported inflation risks across the region, while the dollar’s safe-haven status amplified pressure on floating currencies. As diplomatic efforts and shipping conditions evolved, some of the extreme volatility eased, though the episode highlighted how Middle East geopolitics quickly affect regional exchange rates and energy costs.For those tracking dollar rates, the interbank level offers the official benchmark while the open-market quote better reflects cash demand across trade, travel, savings, and remittances.