Rupee slides past 96/USD to one-month low as oil climbs; RBI steps in

The rupee weakened past 96 against the dollar on Monday, touching a one-month low as crude oil prices extended their rally. State-run banks were seen selling dollars on behalf of the Reserve Bank of India, three traders said, an intervention aimed at checking the currency's slide.

Brent crude rose above $85 a barrel, adding pressure on India's import bill. The rupee closed at 96.05, down 0.4% on the day. Analysts said the central bank's intervention may slow the pace of depreciation but is unlikely to reverse the trend unless oil prices retreat.

India imports about 85% of its crude oil needs. A sustained move above $85 a barrel would widen the current account deficit and keep the rupee under pressure, the traders said. The RBI has a track record of smoothing volatility rather than defending a specific level.