Interventions from the Reserve Bank of India helped contain further losses in the rupee, currency traders said.
On a closing basis, the rupee was marginally weak from its previous close of 84.83/$1, LSEG data showed.
“Demand from local importers continued to keep the rupee under pressure. There were some inflows, but they were all absorbed by the RBI. The central bank was seen protecting levels of 84.87 to 84.88 but RBI interventions did not change the direction of the pair,” said Anil Bhansali, head of treasury at Finrex Treasury Advisors.
Market participants expect the pace of RBI interventions to slow. Sanjay Malhotra took charge of the central bank as its Governor on Wednesday after a six-year tenure of Shaktikanta Das.
Separately, odds of a December rate cut by the Federal Reserve shortened after data showed US consumer price index rose in-line with expectations in November. The consumer price index rose 0.3%, increasing 2.7% year-on-year.The likelihood of a 25-basis-point rate cut increased to 97% on Thursday, up from 86% the previous day, according to CME’s FedWatch Group.