Indian central bank likely steps in to defend rupee, traders say

Business Recorder reported, citing four traders who spoke to Reuters, that the Reserve Bank of India probably stepped into the foreign exchange market on Monday. The rupee had dipped to 95.49 per dollar in early trading, but dollar sales by state-run banks, which traders believed were made for the RBI, limited the decline. This possible move came against a backdrop of uncertainty over the Middle East conflict, which has kept oil prices high and sentiment fragile.

Traders said the central bank has been active in the currency market often during the past week. They believe these operations are aimed at steadying expectations for the rupee. Traders reckon the RBI is trying to give the currency a steadier anchor during a period of uncertainty. Brent crude futures were trading 0.3% higher at $88.8 per barrel on the same day.