The US dollar fell below 279 Pakistani rupees in the inter-bank market on Friday, reaching 278.95 rupees — a level not seen since March 2022. The rupee has been on a steady upward trend since January, driven by expected capital inflows and a crackdown on currency smuggling, following Pakistan's near-default in 2023 that was averted through IMF bailout funds and Chinese financial support. The exchange rate stabilisation is seen as a key indicator of broader economic recovery, with inflation having fallen to around three percent, though interest rates remain elevated at 10.5 percent.