The Indian rupee was slightly higher against the US currency after a choppy session in which the likely sold dollars to support the local currency.
The rupee ended at 81.86 per US dollar, a tad higher than the new low of 81.94 in the previous session.
The rupee had opened higher at 81.61, but was not able to sustain the gains on dollar buying by foreign banks and oil companies.
The rupee came close to falling below the record low of 81.95, prompting the RBI to sell dollars, according to traders. Two bankers and a FX brokerage firm confirmed the intervention by the central bank to the central bank.
For more than two hours in afternoon trades, the rupee was in a narrow trading range of 81.90 to 81.93 to the dollar.
A trader at a private sector bank said that the rupee managed to avoid falling below 82 once again.
The trader said that it looks like it is only a matter of time before the rupee falls below that level.
The rupee was put under pressure due to the rebound in the dollar index and a renewed selloff in Treasuries. The dollar gauge was up 0.5% at 113.36 and the 10 year Treasury yield was up about 15 basis points.
The overnight rally was unlikely to sustain, according to U.S. equity futures. India's equity gauge, the BSE Sensex, fell by 0.3% to 56,409. The Sensex had climbed to 57,166 earlier in the session.