MUMBAI, Oct 10 (Reuters) – The Indian rupee recovered from a record low to end flat on Monday after the Reserve Bank of India (RBI) likely intervened in the markets, but analysts stuck to their view. that the local currency was ready to suffer further losses. .

The partially convertible rupee pared all of its losses to close unchanged at 82.32 to the dollar, falling from a record low of 82.6825 hit in early morning trading.

The RBI likely sold dollars through state banks at levels of 82.60 to 82.65, traders told Reuters, as a U.S. jobs report confirmed bets on more aggressive rate hikes by the Federal Reserve and prompted a sell-off in Asian assets.

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RBI has been in the market “continuously” as they “tight” the rupee to take it to 82.40 to the dollar, a trader at a Mumbai-based bank said.

A public holiday in the United States meant that purchases of dollars for commercial accounts were reduced to some extent, also helping the central bank to keep the rupee well contained, he added.

India’s currency has risen from below 80 to the dollar to above 82 in less than three weeks, with the central bank occasionally intervening to curb volatility.

The depletion of India’s foreign exchange reserves in the face of the rapid depreciation of the rupee was becoming a matter of concern, as they fell by 16% at the end of September compared to the beginning of the year. This is the largest percentage decline among emerging Asian markets, Goldman Sachs analysts said.

Economists from HDFC and Elara Capital also expressed concerns over expected rate hikes from the US Federal Reserve, with rising oil prices and a widening trade deficit further weighing on the currency.

Elara’s Garima Kapoor warned that the rupee could fall to 83.50 to the dollar by December and further to 84-85 in March.

Meanwhile, the dollar index climbed above the 113 levels and oil prices hovered around $97 a barrel. Crude jumped around 10% this month on production cuts alone, with analysts saying the $100 price was on the horizon.

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Reporting by Anushka Trivedi in Mumbai; Editing by Neha Arora

Our standards: The Thomson Reuters Trust Principles.

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