Reserve Bank of India likely steps in to defend rupee near 96 per dollar

The Reserve Bank of India likely intervened in the foreign exchange market on Wednesday, four traders told Reuters, signalling that the central bank intends to keep supporting the rupee amid a volatile global backdrop. The rupee was last quoted at 95.97 per dollar, little changed on the day.

State-run banks were seen offering dollars, most likely on behalf of the RBI, the traders said. Offers were concentrated around the 96 per dollar mark, one of the traders added.

According to Reuters, the RBI has been managing the rupee through frequent interventions, using its increased foreign exchange reserves to prevent external pressures from translating into excess pressure on the currency.

The accounts come from currency traders rather than the central bank, and the reported intervention could not be independently confirmed. The rupee's close to unchanged level on the day suggests any support was aimed at smoothing moves rather than reversing them.