AKD Research has said Pakistan’s macroeconomic conditions are improving, with indicators pointing toward a potential strengthening of the Pakistani Rupee (PKR) against the US dollar in FY26.

In its latest Market Vista report, the brokerage attributed the improved outlook to easing external pressures, including lower global oil prices, a reduced import bill, and a continued increase in foreign exchange reserves since the last Monetary Policy Committee meeting. It also highlighted strong remittance inflows and ongoing fiscal tightening as key stabilizing factors.

The report noted that these developments, along with expectations of contained inflation and positive real interest rates, are likely to support investor sentiment and provide backing for the local currency.

AKD Research expects the State Bank of Pakistan (SBP) to maintain its current policy stance in the near term while assessing evolving domestic and global conditions.

It further pointed to improving balance-of-payments dynamics and declining energy costs as additional factors that could support rupee stability and potential appreciation during FY26. The brokerage estimates real interest rates to average around 4.5 percent over the next 12 months, which it says could encourage capital inflows.

With reserves rising and external risks gradually easing, AKD Research expects the rupee to remain supported and potentially strengthen against the dollar in FY26.