The Indian rupee showed minimal movement on Tuesday, with market participants anticipating a sideways trend as the Reserve Bank of India (RBI) effectively curbed significant drops, thereby reducing short-term volatility expectations. As of 09:50 a.m. IST, the rupee stood at 83.4975 against the U.S. dollar, almost unchanged from its previous close at 83.5050. On Monday, the rupee stayed within a tight range, with possible interventions by the RBI preventing further depreciation, according to traders. The central bank's actions have also contributed to a decrease in the near-term volatility of the dollar-rupee pair. The 1-month implied volatility has dropped to 2.20%, down from its six-month high of 3.35% at the end of May, just before the announcement of India's national election results on June 4. A foreign exchange trader at a foreign bank noted that the rupee is unlikely to drop significantly below 83.50 due to ongoing dollar selling offers from state-run banks, possibly acting on behalf of the RBI. Meanwhile, the dollar index was at 105.1, and most Asian currencies weakened ahead of the highly anticipated U.S. inflation data and the Federal Reserve's policy decision, scheduled for Wednesday. Although the U.S. central bank is expected to maintain current policy rates, market participants will closely monitor comments from Fed Chair Powell and any changes to the interest rate dot plot. Interest rate futures currently indicate about 38 basis points of potential rate cuts in 2024, a decrease from nearly 50 last week. Anil Bhansali, head of treasury at Finrex Treasury Advisors, suggested that the rupee's movement will likely mirror the previous session, with a close watch on the RBI and the 83.50 level.