Dataset Series (showing observations of recent periods)

View

Series Name

Graph

Unit

Sep-2022

Oct-2022

Nov-2022

Dec-2022

Jan-2023

Feb-2023

a. NEER (Base 2010=100)

46.89,49.89,48.87,47.25,44.46,39.29

Index

46.89

49.89

48.87

47.25

44.46

39.29

b. REER (Base 2010=100)

91.71,101.57,100.31,97.47,93.96,86.45

Index

91.71

101.57

100.31

97.47

93.96

86.45

c. NEER (Base 2010=100): MOM Changes

-2,6.39,-2.05,-3.3,-5.91,-11.64

Percent

-2.00

6.39

-2.05

-3.30

-5.91

-11.64

d. REER (Base 2010=100): MOM Changes

-3.63,10.75,-1.24,-2.83,-3.6,-8

Percent

-3.63

10.75

-1.24

-2.83

-3.60

-8.00

row(s) 1 - 4 of 4

Dataset Overview

Business Area

External Sector

Dataset Name

Nominal/Real Effective Exchange Rates Indices of Pak Rupees

Dataset Description

Nominal Effective Exchange rate (NEER) is an index of the bilateral nominal exchange rates of one country relative to its major trading partners or selected basket of currencies.
The bilateral nominal exchange rate index with each trading partner weighted by that country’s share in imports, exports, or total foreign trade. While the Real Effective Exchange rate (REER) is an index of the price of a basket of goods in one country relative to the price of the same basket in that country's major trading partners. The prices of these baskets expressed in the same currency using the nominal exchange rate with each trading partner. The price of each trading partner's basket is weighted by its share in imports, exports, or total foreign trade.

Explanatory Notes:

I. A REER index of 100 should not be misinterpreted as denoting the equilibrium value of the currency. 100 merely represents the value of the currency at a chosen point in time (in this case the average value of the currency in 2010). Therefore, movement of the REER away from 100 simply reflects changes relative to its average value in 2010 and is unrelated to its equilibrium value.

II. From July 2020, PBS has discontinued the dissemination of CPI on base 2007-08 using which the REER index was calculated, and changed the base to 2015-16. For the
compilation of the REER index, therefore, the CPI - Base 2015-16 has been spliced and rebased to 2010 using the IMF's methodology.

III. RPI and REER indices may be revised due to revisions in base period or splicing factor of CPIs data by PBS.

IV. Weights and number of trading partners have been updated from Jan, 2016 and revised for Jan, 2013 to Dec, 2015. The REER and NEER have been recalculated since Jan, 2013 using these revised weights and number of trading partners. For detail, please see the Revision Study.

V. Appreciation (depreciation) of REER is sometimes confused with the concept of currency overvaluation (undervaluation) while these are two separate concepts and not necessarily interpreted in the same direction. For an assessment of a country’s exchange rate misalignment, a more sophisticated analysis is required taking into account factors such as demographics, external and fiscal sustainability, and some other macroeconomic fundamentals over the medium-term. This video on REER [by SBP] goes into further detail.