The Reserve Bank of India intervened in the currency market on Tuesday as the rupee slid towards the 96-mark against the US dollar, and the domestic currency closed 13 paise higher at 95.81.

Dealers said the central bank was seen selling dollars through state-run banks in the morning session, when the rupee came under fresh pressure. Traders said RBI presence was visible near the 95.95-96.00 zone, which many now see as the central bank's line in the sand. The RBI does not comment on its market operations.

The rupee has been under sustained strain from foreign fund outflows, a firm US dollar and elevated American bond yields. The US 10-year Treasury yield is at 5.24 percent, its highest since 2007, which has pulled money out of emerging markets. Foreign institutional investors have sold Indian equities worth 25,662 crore rupees so far in September, according to NSDL data.

Analysts say the RBI is walking a tightrope — preventing disorderly depreciation while conserving reserves. A weaker rupee pushes up import costs, particularly for crude oil, but it also supports exporters. Currency watchers expect the central bank to keep defending the 96 level in the coming sessions, even as global pressures persist.