The RBI likely stepped in to support the rupee, with traders pointing to dollar sales by state-run banks. Representational image
| Photo Credit: Reuters

The Indian rupee weakened to a record low on Tuesday (December 10, 2024), pressured by heightened expectations of domestic rate cuts next year after the government named career civil servant Sanjay Malhotra as the next governor of the Reserve Bank of India (RBI).

The rupee hit a low of 84.80 in early trading, surpassing its previous all-time low of 84.7575 hit last week.

The RBI likely stepped in to support the rupee, with traders pointing to dollar sales by state-run banks.

Mr. Malhotra, currently serving as the revenue secretary to the finance ministry, has been appointed as the RBI governor for a three-year term starting December 11.

A likely shift towards accommodative monetary policy is among the potential changes that could occur under the new governor, Nomura said in a note.

A rate cut at the RBI’s February monetary policy committee meeting is “now likely cemented”, Nomura said.