The rupee touched an all-time low of 84.0850 during afternoon trading, briefly surpassing last week’s low of 84.0825, before closing at 84.0775 per dollar, just above Friday’s close of 84.0800. Pressures on the rupee came as the U.S. 10-year Treasury yield rose to its highest level since late July, pushing the dollar index above 104.50 and affecting most Asian currencies. Traders noted that low trading volumes in the rupee market added to the currency’s vulnerability amid volatile capital flows.
In an effort to curb the rupee’s decline, the RBI likely intervened by selling dollars through public sector banks, following a pattern of recent interventions aimed at steadying the currency. The central bank appears intent on aligning the rupee’s trajectory with broader emerging market trends while managing significant foreign outflows, according to Prasanna, a prominent market analyst.
Foreign investors withdrew a heavy $10 billion from Indian equity and debt markets in October, marking the largest sell-off of the year. The RBI’s consistent involvement has mitigated rupee volatility, contributing to the narrowest weekly trading range in at least a decade, LSEG data showed.
