Indian rupee hits new low, amid sterilized intervention

Chief Regulatory Officer at CSE Renuke Wijayawardhane presenting the listing certificate to Executive Chairperson at Renuka Hotels Shibani Thambiayah

MUMBAI, August 20, 2013 (AFP) – India’s rupee slumped to a new record low against the dollar Tuesday, prompting suspected central bank intervention, amid fears that measures to stabilise the currency and kickstart the economy will not work.

Asia’s worst-performing currency this year slid to 64.13 rupees to the dollar in morning trading, past its previous low of 63.22 the previous day.

The plunge was believed to have led the central bank to intervene twice in the foreign exchange market to sell dollars for rupees, dealers said.

The suspected intervention lifted the Indian unit slightly but it still ended the day at a new lifetime closing low of 63.25 rupees to the dollar.

The RBI does not confirm forex market interventions and says it intervenes only to prevent rupee volatility.

The troubles of the rupee, which has fallen nearly 17 percent against the dollar this year, has spilt over to the stock and bond markets.

Indian shares — which have lost seven percent in the past three trading days — slid as much as 1.83 percent in early trade Tuesday to a low of 17,970.98 points before recovering to close down 0.34 percent at 18,246.04.

The yield on the 10-year benchmark bond hit 9.23 percent intraday, the highe