The calm October run for the Indian rupee could not last

 The calm October run for the Indian rupee could not last

At 11:08 a.m. IST, the rupee was trading at 83.27 versus the US dollar, somewhat down from 83.25 during the previous session.

The Reserve Bank of India's defense of the Indian rupee will eventually become unsustainable, traders argued, and the currency is likely to break out of rangebound trading.

At 11:08 a.m. IST, the rupee was trading at 83.27 versus the US dollar, somewhat down from 83.25 during the previous session.

Despite ongoing local dollar demand and equities withdrawals, the rupee's monthly range shrunk last month as the central bank's forex market interventions kept the currency from falling below the record low of 83.29.

The Middle East armed crisis and the jump in U.S. Treasury rates may not have a significant negative impact on the rupee.

It is unlikely that October's events will occur again, according to bankers.

It seems doubtful that the rupee's current tight range would remain, according to Apurva Swarup, vice president of Shinhan Bank India.

He remarked, "Eventually the RBI will have to stop," since the present strategy is not long-term viable.

Expectations of volatility for the rupee have decreased. On Wednesday, one-month implied volatility decreased to 2.45%, a multi-year low.

"It's a good idea to buckle up and get ready for a possible ride into increased volatility," said Amit Parbari, managing director of the currency advice company CR currency.

Prior to the announcement of U.S. Federal Reserve policy later in the day on Wednesday, the majority of Asian stocks declined.

The yield on the 10-year U.S. Treasury increased, while the dollar index increased to 106.75.

It is generally anticipated that the Fed would leave the policy rate unchanged.

Investors will be watching Fed Chair Jerome Powell's news conference closely for clues about the potential timing of another rate increase.