Two Decades of Decline: How the Pakistani Rupee Lost Its Ground Against the Dollar (1947-2024)

The Stable Era: A Currency That Refused to Budge

When Pakistan gained independence in 1947, one US dollar was valued at 3.31 PKR—a rate that would remain virtually unchanged for nearly a decade. From 1947 through 1954, the Pakistani rupee held firm at this peg, reflecting a period of economic stability and controlled exchange rates. This stagnation finally broke in 1955 when the rate shifted to 3.91 PKR per dollar, followed by a jump to 4.76 PKR in 1956—a level that persisted for another 15 years until the early 1970s.

The First Real Shock: The 1972 Disruption

The 1972 rupee devaluation marked a turning point. The exchange rate spiked to 11.01 PKR per dollar, then corrected to 9.99 PKR where it remained artificially anchored through the 1980s. This period reflected Pakistan’s struggle with inflation and external pressures, yet the government managed to maintain nominal stability through capital controls and fixed-rate policies.

Acceleration Begins: The 1990s Downward Spiral

The real story of rupee deterioration began in the late 1980s. By 1989, dollar to PKR exchange rates had climbed to 20.54, and the pace of depreciation accelerated sharply through the 1990s. In 1990, the rate was 21.71 PKR; by 1995, it had nearly doubled to 31.64 PKR. The late 1990s saw this trend intensify—hitting 41.11 PKR in 1997 and surging to 51.90 PKR by 1999, reflecting the impact of economic crises and structural imbalances.

The Crisis Years: 2001-2008

The new millennium brought renewed instability. Dollar to PKR rates jumped to 63.50 in 2001 before settling into a gradual appreciation phase through the mid-2000s. However, by 2008—during the global financial crisis—the rupee came under fresh pressure, with rates reaching 81.18 PKR per dollar in 2009, marking a critical threshold as the currency lost purchasing power against the greenback at an accelerating rate.

Free Fall: The 2010s-2020s

The 2010s witnessed unprecedented rupee weakness. Starting from 85.75 PKR in 2010, the currency entered a sustained depreciation cycle. The rate breached the 100 mark by 2012 (96.50 PKR), continued climbing through 2013 at 107.29 PKR, and accelerated dramatically in 2018 when it hit 139.21 PKR. By 2019, it had deteriorated to 163.75 PKR, and the pace only quickened thereafter.

The Collapse: 2020-2024

The final chapter has been the most severe. In 2020, the rate stood at 168.88 PKR per dollar. By 2022, amid inflation and capital flight pressures, the rupee plummeted to 240 PKR per dollar—a staggering decline in just two years. Though there was modest recovery in 2024 to 277 PKR per dollar (down from 286 PKR in 2023), the rupee has lost nearly 85% of its value since independence.

What This Means

From 3.31 PKR in 1947 to 277 PKR in 2024, the Pakistani rupee’s 77-year journey reflects decades of inflation, external imbalances, debt accumulation, and structural economic challenges. Each decade tells a story of institutional pressures, policy decisions, and the cost of prolonged macroeconomic instability on ordinary citizens’ purchasing power.