Overview

• The Indian rupee fell to an all-time low of 84.88 against the U.S. dollar before closing slightly higher at 84.8575 on Thursday.
• The Reserve Bank of India (RBI) intervened by selling dollars through state-run banks to curb further depreciation of the currency.
• Heightened demand for the U.S. dollar in the non-deliverable forwards (NDF) market and dollar purchases by Indian importers, including oil companies, have contributed to the rupee's decline.
• A weaker Chinese yuan and concerns over India's slowing economic growth have added to the rupee's downward pressure.
• Dollar-rupee forward premiums rose as expectations of a U.S. Federal Reserve rate cut in December strengthened, but RBI actions helped stabilize the forward market.