Indian rupee averts record low on likely RBI intervention as local equities slide

The Indian rupee was nearly flat on Friday as likely intervention from the Reserve Bank of India helped the currency hold above its all-time low amid pressure from weakness in local equities, which declined tracking a sell-off in global peers.

The rupee was at 83.72 (Dh22.81) against the US dollar as of 10.35 am IST, nearly unchanged from its close at 83.71 (Dh22.80) on Thursday.

Benchmark Indian equity indexes, the BSE Sensex and Nifty 50, were down about 1 per cent each, tracking a sell-off in global peers.

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U.S. stock futures also extended their declines, with Nasdaq futures down 1.3 per cent while S&P 500 futures fell by 0.7 per cent.

Dollar bids from at least two large US-based foreign banks, likely on behalf of custodial clients, pressured the rupee in early trading, a foreign exchange trader at a private bank said.

The RBI likely sold dollars via state-run banks to support the local currency as it hovered close to its all-time low of 83.7450, traders said.

Concerns about geopolitical tensions and a slowdown in the U.S. economy, in light of data that signalled an unexpected slump in U.S. manufacturing activity last month, drove U.S. bond yields lower.

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