RBI intervening to defend rupee, new record low seen likely: traders

Central bank ramps up dollar sales to stem further weakening as rupee remains near record lows

The Reserve Bank of India (RBI) has aggressively intervened to support the Indian Rupee, preventing it from falling lower than the record 83.29 against the US dollar.
Amidst weak global risk appetite, rising oil prices, and expectations of the Federal Reserve tightening monetary policy to combat inflation, the RBI's intervention has so far been able to steady the rupee.
The RBI has sold a net $3.86 billion in the spot foreign exchange market in August, as part of its ongoing efforts to stem the rupee's weakening.
The rupee's recovery is doubtful but its weakening may be halted thanks to the RBI's intervention, according to a foreign exchange salesperson at a mid-sized private bank.
Despite these interventions, the risks of the rupee falling to a new record low are rising due to increasing US yields and oil prices. This would require the RBI to continue its aggressive stance in order to maintain stability.