Nimesh Vora

The Reserve Bank of India (RBI) likely intervened to support the rupee after the currency slipped to an all-time low on Tuesday amid worries over a sizeable widening of the Asian nation's trade deficit.

The Reserve Bank of India on Friday raised the interest rate ceiling that banks can offer for foreign currency non-resident (FCNR-B) deposits to boost forex inflows at a time when the currency has been regularly hitting all-time lows.

Nomura stuck by its contrarian call that the Reserve Bank of India will lower interest rates on Friday as concerns over economic growth overshadow worries about high inflation and the rupee's weakness.

The Indian rupee declined to a lifetime low on Tuesday, pressured by the U.S. dollar's rally against its major peers and on concerns over the Asian country's slowing growth rate.

The Indian central bank was likely selling dollars on Monday to support the rupee, traders said, after the currency declined to its all-time low on concerns about foreign portfolio outflows following weak economic data and a decline in Asian peers.

The Indian rupee is likely to hover near its all-time low on Friday as concerns about portfolio outflows override the recovery in Asian peers.

The Indian central bank, in a rare move, instructed some banks to cut their long positions on the dollar-rupee pair on Friday, seeking to reduce speculative bets on the local currency, which is at a record low, four bankers directly familiar with the development told Reuters.

The Indian rupee is likely to dip to a lifetime low on Thursday in wake of the dollar and U.S. rates extending their post-U.S. election rally.

The Indian rupee was slightly weaker on Thursday, tracking a decline in Asian peers, as the dollar index climbed to its highest level in a year amid ongoing momentum following Donald Trump's victory in the U.S. elections.

The period of low volatility that the Indian rupee has enjoyed may not last now that Donald Trump is poised to become U.S. president once again, bankers and advisors cautioned, urging companies to manage their forex risks more prudently and proactively.