Karachi, June 14, 2025: The Saudi Riyal (SAR) strengthened slightly against the Pakistani Rupee (PKR) in the open market on Saturday, June 14, 2025, with the buying rate rising to Rs75.38 from yesterday’s Rs75.34.
The selling rate also increased marginally to Rs75.92, reflecting a subtle upward trend in the currency pair, according to data from local forex markets. This shift underscores ongoing dynamics in Pakistan’s foreign exchange market, driven by economic factors and the significant role of remittances from Saudi Arabia.
Valuation Mechanism of SAR to PKR
The exchange rate between the Saudi Riyal and Pakistani Rupee is determined primarily by supply and demand dynamics in the open market, where currency exchange dealers set rates based on real-time transactions. The Saudi Riyal is pegged to the US Dollar (USD) at a fixed rate of 3.75 SAR to 1 USD, managed by the Saudi Central Bank. This peg indirectly influences the SAR-PKR rate, as fluctuations in the USD-PKR exchange rate ripple through to the Riyal. For instance, the US Dollar was reported trading at Rs282.9 (buying) and Rs285.30 (selling) on June 13, 2025, providing a benchmark for SAR’s valuation.
Additional factors influencing the SAR-PKR rate include:
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Remittances: Pakistan received $34.9 billion in workers’ remittances from July 2024 to May 2025, with $913.3 million from Saudi Arabia in May alone, the highest among all countries. This high inflow strengthens demand for SAR, supporting its value against PKR.
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Economic Conditions: Pakistan’s trade balances, inflation rates, and foreign exchange reserves, managed by the State Bank of Pakistan, impact the PKR’s strength. The PKR often faces volatility due to external debt obligations and trade dynamics.
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Geopolitical and Market Sentiment: Regional stability and global economic trends, such as oil prices (given Saudi Arabia’s oil-driven economy), can cause short-term fluctuations in the SAR-PKR rate.
The State Bank of Pakistan may intervene to stabilize the PKR, but the open market largely reflects organic supply-demand shifts. Today’s slight increase in the SAR-PKR rate suggests a modest rise in demand for the Riyal, possibly linked to remittance inflows or seasonal factors like travel for Hajj or Umrah.
Reasons Pakistanis Purchase Saudi Riyal
Pakistanis acquire Saudi Riyals (SAR) due to deep economic, religious, and cultural connections with Saudi Arabia:
Pilgrimage Travel: Millions of Pakistanis visit Saudi Arabia annually for Hajj and Umrah, needing SAR for costs like lodging, transport, and meals.
Remittances: Pakistani workers in Saudi Arabia send SAR earnings home, which families or exchange firms convert to Pakistani Rupees (PKR).
Trade Transactions: Businesses trading with Saudi Arabia, especially in textiles and food exports, use SAR for payments.
Currency Stability: With the SAR pegged to the US Dollar, some Pakistanis hold it as a safeguard against PKR devaluation amid Pakistan’s economic volatility.
Effects on Pakistani Expatriates
The SAR-PKR exchange rate of Rs75.34 impacts Pakistani expatriates and their families significantly:
Higher Remittance Value: A stronger Riyal increases the PKR value of remittances, enhancing families’ purchasing power for essentials, education, and local economic activity, especially in rural regions.
Rising Pilgrimage Costs: A higher SAR rate raises the PKR cost of Hajj or Umrah, potentially burdening lower-income pilgrims.
Financial Predictability: Stable SAR-PKR rates aid expatriates and families in planning finances and cross-border payments.
Vulnerability to Global Factors: The Riyal’s USD peg offers stability, but shifts in oil prices or US monetary policies could indirectly influence the SAR-PKR rate, affecting expatriates’ PKR earnings.
Strengthened by ties like Saudi Arabia’s $3 billion deposit extension to Pakistan, these economic links remain robust.
Overview of Saudi Riyal and Pakistani Rupee
Saudi Riyal (SAR): The official currency of Saudi Arabia, denoted as SAR or SR, is divided into 100 halalas. Managed by the Saudi Central Bank, it has been pegged to the US Dollar since 1986, ensuring stability. Evolving from bimetallic coins to modern currency since 1932, the Riyal reflects Saudi Arabia’s economic resilience.
Pakistani Rupee (PKR): Pakistan’s currency, symbolized as PKR or Rs, is split into 100 paisa. Overseen by the State Bank of Pakistan under a managed float, its value fluctuates based on market dynamics, remittances, and trade. Introduced in 1948, the Rupee faces challenges from economic instability but remains vital for domestic and global transactions.
 strengthened slightly against the Pakistani Rupee (PKR) in the open market on Saturday){kind=link}