How Pakistan's Currency Collapsed: A 77-Year Journey from 3.31 to 277 PKR per Dollar

Pakistan’s relationship with the US dollar tells a fascinating story of economic turbulence. Since independence in 1947, the Pakistani rupee has experienced a dramatic depreciation, losing over 98% of its value against the dollar.

The Stable Era (1947-1971)

For the first two decades, the rupee remained remarkably stable. Throughout the late 1940s and 1950s, 1 USD consistently exchanged for just 3.31 PKR. This period of monetary stability persisted until 1954, reflecting post-independence economic management. The rate gradually shifted to 3.91 PKR in 1955, before settling at 4.76 PKR from 1956 onwards—a level that would hold for nearly 16 years.

The First Major Shock (1972-1979)

The early 1970s marked a turning point. By 1972, the exchange rate jumped to 11.01 PKR per dollar, followed by a subsequent adjustment to 9.99 PKR. Remarkably, this rate persisted throughout the late 1970s, creating another plateau of relative stability.

Accelerating Depreciation Begins (1989-2012)

The late 1980s onwards witnessed consistent rupee weakness. From 1989’s 20.54 PKR level, the currency deteriorated year after year—reaching 23.80 in 1991, crossing 30 PKR by 1994, surpassing 50 PKR by 1999, and hitting 60+ PKR in the mid-2000s.

The Critical Turning Point (2013-2018)

Between 2013 and 2018, the rupee faced unprecedented pressure. In 2013, 1 USD exchanged for 107.29 PKR. Within five years, this skyrocketed to 139.21 PKR by 2018—representing a 30% decline in just 60 months. This period coincided with Pakistan’s economic challenges, including the IMF bailout discussions and external account pressures.

From Crisis to Freefall (2019-2024)

The deterioration accelerated further. The 2019 rate of 163.75 PKR quickly became history as 2020 saw 168.88 PKR, 2022 reached 240 PKR, and by 2023, one dollar commanded 286 PKR. In 2024, the rate settled around 277 PKR—though still reflecting the currency’s weakened state.

Over seven decades, Pakistan’s rupee has transformed from one of South Asia’s stronger currencies to one facing consistent depreciation pressures. What cost 3.31 rupees in 1947 now costs 277 rupees in 2024—a stark reminder of inflation, capital outflows, and structural economic challenges.