Saudi Riyal to Pakistani Rupee Rate; May 07, 2025

Karachi, May 7, 2025 – The Saudi Riyal (SAR) continues to hold steady against the Pakistani Rupee (PKR), trading at an exchange rate of 74.96 PKR in the open market, according to the latest reports from the Forex Association. This stability reflects a balanced interplay of economic factors, including robust remittance inflows and controlled speculative activity, which have fortified the currency market in Pakistan.

Valuation Process of the Saudi Riyal Against the Pakistani Rupee

The valuation of the Saudi Riyal against the Pakistani Rupee is determined primarily through the open market, where exchange rates are influenced by supply and demand dynamics. The Saudi Riyal is pegged to the U.S. Dollar at a fixed rate of 3.75 SAR to 1 USD, a policy in place since 1986, which indirectly stabilizes its value against other currencies like the PKR. In Pakistan, the exchange rate is shaped by several key factors:

• Remittance Inflows: A significant portion of Pakistan’s foreign exchange reserves comes from remittances sent by expatriates, particularly those working in Saudi Arabia. These inflows increase the supply of Saudi Riyals in the market, helping to stabilize the exchange rate.
• Trade Balance: The economic relationship between Pakistan and Saudi Arabia, including trade and investment, influences the demand for SAR. Balanced trade activity reduces volatility in the exchange rate.
• Forex Reserves and Monetary Policy: The State Bank of Pakistan monitors and occasionally intervenes in the currency market to maintain stability. Adequate foreign exchange reserves provide a buffer against sudden fluctuations.
• Market Speculation: Reduced speculative trading, as observed in recent days, has contributed to the Riyal’s steady performance against the PKR.

The current rate of 74.96 PKR reflects a marginal increase from earlier weeks, aligning with forecasts predicting a range of 73.72 to 76.06 PKR for May 2025. This stability is further supported by Pakistan’s improved economic indicators, including a bolstered stock market and steady foreign inflows.

Impact on Pakistan’s Economy and Society

The stable exchange rate of the Saudi Riyal has several implications for Pakistan’s economy and its citizens:

• Remittance-Dependent Households: With approximately 2.5 million Pakistani workers in Saudi Arabia, remittances are a lifeline for many families. A stable SAR-PKR rate ensures predictable income for households, supporting daily expenses, education, and local economic activity.
• Trade and Investment: The consistent exchange rate fosters confidence among businesses engaged in trade with Saudi Arabia, particularly in sectors like petroleum, textiles, and food exports. It also encourages Saudi investment in Pakistan, aligning with initiatives like the Special Investment Facilitation Council (SIFC).
• Travel and Pilgrimage: The stability benefits Pakistani pilgrims traveling to Saudi Arabia for Hajj and Umrah, as it ensures predictable costs for currency conversion, making religious travel more financially manageable.
• Inflation Control: A stable Riyal helps mitigate imported inflation, particularly for goods priced in Gulf currencies, such as oil, which is critical for Pakistan’s energy sector.

However, a potential risk lies in external shocks, such as fluctuations in global oil prices or changes in U.S. monetary policy, which could indirectly affect the Riyal’s peg to the USD and, consequently, its value in PKR.

Introduction to the Saudi Riyal and Pakistani Rupee

Saudi Riyal (SAR): The Saudi Riyal is the official currency of Saudi Arabia, abbreviated as SAR or SR and subdivided into 100 halala. Issued by the Saudi Central Bank, it has been pegged to the U.S. Dollar since 1986, ensuring stability in international transactions. The Riyal’s history traces back to the establishment of Saudi Arabia in 1932, evolving from a bimetallic system to a fiat currency by 1959. Saudi Arabia’s Vision 2030 and recent initiatives, like the introduction of a new Riyal symbol in February 2025, underscore its role as a symbol of financial ambition in the Gulf region.

Pakistani Rupee (PKR): The Pakistani Rupee, abbreviated as PKR or Rs, is the official currency of Pakistan, subdivided into 100 paisa. Managed by the State Bank of Pakistan, the Rupee operates under a managed float regime, with its value influenced by market forces and occasional central bank interventions. The Rupee’s value is closely tied to Pakistan’s economic performance, remittance inflows, and trade dynamics, particularly with key partners like Saudi Arabia.

The Saudi Riyal’s stable exchange rate of 74.96 PKR signals a period of economic steadiness for Pakistan, driven by strong remittance flows and balanced trade with Saudi Arabia. This stability not only supports millions of Pakistani households but also strengthens bilateral economic ties. As both nations deepen their financial and cultural connections, the SAR-PKR exchange rate will remain a critical barometer of their shared prosperity.