INDIA RUPEE-Rupee pinched by tepid stocks, bond index delay; intervention lends support

By Jaspreet Kalra

MUMBAI, Jan 13 (Reuters) - The Indian rupee dipped slightly on Tuesday, weighed down by tepid local stocks and a deferral of Indian bonds' inclusion in a flagship global index while intervention by the Reserve Bank of India offered support.

The rupee INR=IN was at 90.25 per dollar as of 11:00 a.m. IST, down 0.1% on the day.

Indian stocks lagged behind most regional peers and the benchmark indices, BSE Sensex .BSESN and Nifty 50 .NSEI, were nearly flat after dipping in early trading.

Bloomberg Index Services on Tuesday deferred the inclusion of Indian bonds in its flagship Global Aggregate Index, saying it will provide an update in mid-2026. The move sent the yield on the 10-year benchmark bond up by as much as 6 basis points to 6.63%.

The rupee, though, was largely steadfast in the face of negative cues, including weakness in most Asian currencies as the central bank likely stepped in to support it, traders said.

The "(dollar) buying appetite is also quite limited right now but it is likely to pick up later in the session, which could keep the rupee under pressure - as far as the central bank allows," a senior trader at a Mumbai based bank said.

Later in the day, the focus will also be on the result of the RBI's $10 billion dollar-rupee buy/sell swap auction. Bankers expect the auction to sail through on the back of demand generated due to an attractive spread in onshore-offshore rates alongside heightened corporate interest.

Meanwhile, the dollar index =USD treaded water at 98.9, with investors continuing to fret over the independence of the U.S. Federal Reserve after the Trump administration opened a criminal investigation into Chair Jerome Powell.