In a week when oil jumped to $113.17 a barrel and the stock market lost 2,007 points in a day, one part of Pakistan’s financial system stayed remarkably calm: the rupee. On Thursday, 22 October, the US dollar traded at about Rs 276.85 in the interbank market, according to the State Bank of Pakistan’s mark-to-market rates — the central bank’s official daily valuation. The level was 276.8522, with banks quoting a bid of 276.55 and an offer of 277.00.
Two Markets, Two Prices — Explained Simply
Many readers ask why they hear two different dollar rates. The interbank market is where banks trade dollars among themselves and handle the country’s large payments — imports, exports and official transactions. Its rate is the one economists watch, because it reflects the bulk of money flowing in and out of Pakistan.
The open market is where individuals buy and sell cash — for travel, education or small business needs — through currency dealers and exchange companies. On Thursday, dealers were buying dollars at Rs 277.52 and selling at Rs 278.65. The open-market price is almost always a little higher than the interbank rate, because it covers the dealer’s costs and margin. This week’s gap was modest — roughly a rupee and a half on the selling side — itself a sign of orderliness. When a currency is in trouble, that gap usually widens sharply.
What Is Supporting the Rupee
A stable exchange rate rests on a simple balance: the supply of dollars coming into the country must roughly match the demand for dollars going out. Inflows — export earnings, remittances sent home by Pakistanis working abroad, and financing from lenders — provide the supply. In recent trading, that balance has held well enough for the rupee to stay in a narrow range around 276 to 277, even while other markets moved sharply.
Such stability has real value: importers can plan their costs, exporters know what their earnings are worth, and families receiving remittances are spared daily swings.
The Threat: A Bigger Oil Bill
The calm, however, faces a clear test. Pakistan imports most of its oil, and oil is paid for in dollars. Brent crude has risen about 86 percent this year and settled at $113.17 on Thursday after attacks in Saudi Arabia heightened Middle East tensions. Every dollar added to the oil price adds to the country’s import bill in the months ahead, which increases the demand for dollars precisely when global conditions are unsettled.
There is a second concern: expensive oil feeds inflation, and inflation influences interest rates. Money-market rates remain firm — three-month KIBOR, the benchmark banks use for lending, stood at 11.76/12.01 percent — and the State Bank’s Monetary Policy Committee meets on Monday, 26 October, with market commentary discussing a possible rate increase.
What to Watch Next
The rupee’s calm is genuinely good news, but it is calm under pressure. If oil retreats, the pressure fades. If Brent stays above $110 for weeks, the import bill will grow and the exchange rate will face a harder test. Watch the oil price first — it leads almost everything else.
Market data: Pakistan Stock Exchange, State Bank of Pakistan and published news reports (figures as of 22 October 2026). Written in our own words for information only — not investment advice.