The US dollar peaked to a new high against the rupee on Tuesday, soaring to Rs175 in the intraday trade.

According to an update on Mettis Global, a web-based financial data and analytics portal, the rupee was being traded at Rs175 against the dollar at 12:23pm compared to the previous session's close of Rs174.43.

The rupee weakened by 37 paisa due to the higher demand for the greenback that "shattered the traders' sentiments", according to the report.

“Market needs a firmer direction. Traders are nervous and unsure about the next move, which is causing the high level of stress," Asad Rizvi, the former treasury head at Chase Manhattan bank, was quoted as saying by the report.

He added that there was no stopping the rupee's "one-sided move" and players were unsure about the size of the next hike. Rizvi said that rebalancing portfolios and mitigating financial losses was difficult, according to the report.

Meanwhile, Forex Association of Pakistan President Malik Bostan told Dawn.com that the delay in the results of the negotiations with the International Monetary Fund (IMF) and rumours of a condition for a further devaluation of the rupee had disturbed the currency market and caused the greenback to exceed the "record level" of Rs175 in the interbank market.

He added that after the condition imposed by the State Bank where biometric proof is required for purchasing $500 or above, demand for the dollar in the open market was close to being "non-existent".

Bostan added that measures for the biometric system could also not be taken since they were supposed to be pulled off with the support of the National Database and Registration Authority.

He said that the rupee had depreciated by 11 per cent since July and the pressure would continue until there was stability in the interbank market and the IMF loan programme was approved.

Status of IMF negotiations

The Ministry of Finance is mum about the outcome of its long negotiations with the IMF for the revival of its $6 billion Extended Fund Facility.

Informed sources said the extended talks between the two sides lasting almost three weeks remained tense in Washington and authorities were given tough targets to complete before a memorandum of economic and financial policies could be finalised.

The programme remains “in recess” since April this year and the sixth review that should have been completed by June remains open while the next review has also become due by now under the revised timetable.

The talks that originally began on October 4 through virtual interaction and were scheduled to conclude by October 15 prolonged until October 23 without anything to publicly report about, said an official.

There is a list of ‘do more’ actions that authorities would need to sort out with various stakeholders, he said.