The Reserve Bank of India's (RBI) measures announced on Aug. 14 to restrict how much Indian citizens and companies can invest abroad raised fears of outright capital controls that would further undermine the confidence of foreign investors.
Traders say policy makers will need to unveil a credible plan to attract foreign inflows to support the rupee, but fear instead the central bank or the government will resort to measures that fail to prevent further currency falls.
Release of minutes from the Federal Reserve would also be watched amid increased expectations the US central bank will start the withdrawal of its monetary stimulus.
KEY FACTORS/EVENTS TO WATCH
Wed: Tata Motors Ltd's annual shareholders' meeting
Release of Fed minutes