MUMBAI: The Indian rupee ended nearly unchanged on Monday, sidestepping a decline in its regional peers and pressure from equity-related outflows, as the Reserve Bank of India’s firm grip on the currency limited losses, traders said.
The rupee closed at 83.9775 against the US dollar, little changed from its previous close of 83.9725.
The RBI on Monday asked state-run and private banks to refrain from betting heavily against the rupee, which has been pinned close to its record low of 83.9850 in recent trading sessions, four sources said.
The rupee has held above the 84 handle largely on account of the central bank’s routine interventions, traders said.
Outflows from equities, elevated oil prices and a stronger dollar all weighed have all weighed on the rupee in recent sessions. The currency posted its worst week since late-May last week, falling 0.3%.
India’s benchmark equity indices Sensex and Nifty 50, logged their sixth straight day of losses on Monday, and ended the session lower by about 0.8% each.
Overseas investors have pulled out nearly $5 billion from Indian stocks over the last five sessions, according to provisional exchange data, while oil prices have climbed to their highest level since August.
Other Asian currencies were mostly weaker by 0.1% to 1.5%, as the dollar hovered close to a seven-week high boosted by fading hopes of aggressive rate cuts by the Federal Reserve after a stronger-than-expected employment report.
“The dollar seems more likely to consolidate recent gains than trend back to mid-September levels,” ING Bank said in a note.
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