In this period, the PKR lost 23% of value against USD and fall to almost 79.2 Rs per USD. Perhaps the currency of Pakistan jolted severely in 2008 and termed as a disaster year for PKR. The alliance of Dual rates in May 1999 established a market-based floating exchange rate regime. The dual exchange rate policy helped manage the chaotic period, consisting of an official exchange rate fixed at PKR 46/USD and a floating rate defined through demand and supply of foreign exchange in the interbank market. After the nuclear test in 2002 made the country influential, but its currency vulnerable, with meager reserves and specific freezing of resident foreign currency accounts. Since 1982 the rate of 1 USD to PKR keeps rising compared to 1 USD to PKR in 1947. However, Pakistan's state bank stabilized the situation and maintained the current account surplus to push up the value of Pakistani rupees against USD. The Ultimate solution was to stay on managed float policy, and consequently, the PKR lost the value by 38.5%, and the cost of import suddenly rose. In a Managed float, no country could keep the fixed-rate regime after Breton wood System collapsed. Later on, when President Zia UL Haq shifted the currency to a managed float, the USD against PKR suddenly elevated to peeks. Also central bank is responsible for buying and selling currency to maintain the range. The floating currency means Fiat money, and the government balances the supply and demand and convertible against the agreed currency rate. The PKR currency holds the status to convert into gold on demand, but later it attains floating currency. The apparent reason was a strong backing from Britain pound to PKR that kept 1 USD to PKR in 1947 below 10 PKR.īefore the Bretton wood System's termination, the government pegged PKR to USD at a fixed rate and backed by the US gold. However, Pakistan rupees pegged to Britain sterling and remained stable against the US dollar.
It's a misconception that the rate of 1 USD to PKR in 1947 at the time of independence was equal. On, We saw one USD was equal to 168.8777 PKR, Which is highest till now. After that we saw some time Pakistani Rupee was strengthening and Some time saw USD Dominating Pakistani rupee. So due to the USA Economy influence, On 17th September 1971 Pakistani government adopted USD as a Foreign Exchange Currency. If you are history Curious people you might know that in early 1970, USA economy dominated the whole world. Don’t worry, we will tell you everything about USD.
So you people might think that when Pakistani Government was adopted USD (Dollar) as a foreign exchange currency. We already told you that in 1947 Pakistani government did not adopt USD as a foreign exchange currency. Many people says that in 1947 1 USD was equal to 1 Pakistani rupee But this is not true.
So if we convert Pakistani rupee to USD according to Sterling Pound, 1 USD to PKR in 1947 was equal to Rs 3.31. At that Time, 1 Sterling Pound is equal to 4.03 US Dollars. In 1947, 1 Sterling Pound is equal to 13.13 Pakistani rupee. So when Pakistani people got independence, Pakistani people had adopted Sterling Pound. Probably it was the cheapest exchange rate in the history of USD and PKR relations.Įveryone in Pakistan knows that Before our independence British rules us. Even though after partition, 1 GBP was equal to 13.33 Pakistani Rupees and at that time and 1 USD to PKR in 1947 was 3.31 Pakistani Rupees. However, the US dollar has a long history and a solid background, yet 1 USD to PKR in 1947 was never equal. Later on, the state bank of Pakistan issued new banknotes in 1948. Initially, both nations used the pre-existing currency note and coins with a stamp of Pakistan’s government. After the fall of British Raj Britain, India emerged as two independent states Pakistan as a Muslim majority state and India as a Hindu majority state.
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