Rupee loses steam as dollar regains Rs2.5

After staging an IMF-induced spectacular rally of 3.8 per cent overnight, the rupee lost steam and depreciated by Rs2.56 against the US dollar in the interbank market on Wednesday. On Tuesday, the first trading day after the long Eidul Azha holidays, the local currency appreciated by Rs10.55 against the greenback amid optimism that the government reached a staff-level agreement for $3 billion stand-by arrangement with the IMF. The agreement is yet to be approved by the Executive Board of the IMF scheduled to meet on July 12. However, currency analysts were sure that speculative elements have entered the market to benefit from the short-lived sentiments. The State Bank of Pakistan reported the dollar’s weighted average closing price at Rs277.41 compared to Rs275.44 on Tuesday, an appreciation of Rs1.97. However, the bankers said the dollar rose by Rs2.56 to Rs278. The SBP governor in an interview with a state-run TV channel said the IMF agreement will bring economic stability and boost export and remittances.