Indian central bank likely selling dollars to support rupee, traders say

The rupee could have drifted lower towards 86 if the RBI had not stepped in to stem the fall, a trader with a private bank said.

The Indian central bank was likely selling dollars on Friday to limit the rupee’s losses and prevent it from hitting a record low, five traders told Reuters.

The rupee was quoted at 85.77 to the U.S. after dipping to an intraday low of 85.7950 in afternoon trade amid a fall in the Chinese yuan and an uptick in the dollar.

The domestic unit had hit a record low of 85.8075 last week.

State-run banks were spotted offering dollars, mostly likely on behalf of the Reserve Bank of India (RBI), around 85.77-85.79 levels, traders said.

The rupee could have drifted lower towards 86 if the RBI had not stepped in to stem the fall, a trader with a private bank said.