The Reserve Bank of India is evaluating several measures to arrest the sharp decline in the Indian rupee.
According to the sources, the central bank is considering the launch of Foreign Currency Non-Resident deposits, issuance of NRI bonds, and additional rupee-dollar buy/sell swap operations.
The sources said all proposals are still under discussion and no final decision has been taken.
On Wednesday, the RBI announced a $5 billion buy/sell swap auction aimed at injecting liquidity into the banking system. The auction is scheduled for May 26 and will have a tenure of three years.
The central bank said the swap would involve banks selling US dollars to the RBI and agreeing to repurchase the same amount at the end of the swap period. The mechanism allows the RBI to infuse rupee liquidity while managing foreign exchange reserves.
The rupee has come under pressure due to rising crude oil prices, firm US bond yields, and sustained demand for the dollar.
The Indian currency fell to a record low of 96.96 against the US dollar on Wednesday after opening at 96.85. It later settled at a record closing low of 96.83 against the greenback.
Reports indicated that RBI intervention helped limit further losses in the currency market.