MUMBAI, April 5: The rupee closed steady near three-month lows on Wednesday, held by the central bank, which traders said absorbed robust foreign equity inflows to ensure the overvalued Indian currency did not undermine exports. Volumes in the $16 billion-a-day market were on the lower side as traders from the State Bank of India (SBI) stayed away from work demanding an increase in their pension.

Government-run SBI, which has more than 200,000 staff at some 9,000 branches across the country, is the biggest player in India’s foreign exchange and bond markets.

There were dollar sellers all around, especially the banks which offer custodial services to funds and only one buyer — the central bank, said the chief trader at a government-run bank. They started buying dollars at 44.64 levels and continuously bid the dollar up.

Analysts say India’s central bank has been aggressively intervening through state-run banks in recent sessions to keep the rupee competitive and also to ensure sufficient rupee funds are available to meet the government’s 1.53 trillion rupee ($34.34 billion) borrowing plan that starts next week.—Reuters