MUMBAI: The Indian rupee firmed against the US currency on Tuesday, as a decline in the dollar index allowed risk assets to recover slightly. The rupee rose to 82.6825 per dollar by 10:05 a.m. IST, against its previous close of 82.8350.

The local currency is headed for a monthly loss of about 1%, faring much better than its Asian counterparts through the turbulence in broader markets by remaining in a narrow range.

This is largely thanks to the Reserve Bank of India’s (RBI) interventions that kept it from weakening to 83 per dollar.

“The choppiness in the local unit (rupee) is likely to be until a major event or data triggers the move,” said Amit Pabari, managing director at CR Forex Advisors. “If the rupee breaks 82.60, it could swiftly move towards 82.20-82.00 levels.

On the upside, losses are likely to be capped around the 83.00 mark,“ Pabari added. Asian equities were mostly higher, while US stock futures pointed to a stronger open as US yields cooled and the dollar index nearly reversed all of Friday’s gains overnight.

The dollar index was flat around 104.80, but still on track to end higher for February, ending a four-month losing streak, as a spate of strong US economic data led to a repricing of the Federal Reserve’s terminal rate expectations.

Indian rupee under pressure on Fed rate-hike bets; RBI likely helps out

Money markets have fully priced in three 25 basis point (bps) rate hikes at the next three Fed meetings.

That is two more than what the markets were expecting before their Jan. 31-Feb. 1 meeting.

There are at least six Fed policymakers on the speaking diary this week to offer a running commentary on the likelihood of further rate hikes.

Meanwhile, India’s December-quarter economic growth data is due after market hours, and is likely to show that growth slowed amid weakening demand, a Reuters poll said.