Market rout: RBI intervenes to protect continuously falling rupee

"The central bank may have been intervening in these markets in small measures in the past too, but Friday's action was quite loud," said a senior currency dealer requesting anonymity.

The Reserve Bank of India (RBI) massively intervened in the local currency market on Friday, and most likely in offshore markets as well, as part of a coordinated global effort to arrest the continuously falling financial asset prices.  

The one-month forward points in offshore markets collapsed from 50 paise to 32 paise in a matter of minutes. The fall in offshore forward points was accompanied by a rapid strengthening of the rupee in onshore markets. The partially convertible currency recovered from 74.50 a dollar to close at 73.76 a dollar.

An RBI spokesperson did not want to comment on the issue, but