MUMBAI: The Indian rupee is likely to open mildly higher on Tuesday after slumping to a record low last week, with traders keeping a close eye on possible intervention from the Reserve Bank of India (RBI) to curb pressure on the local unit.

Non-deliverable forwards indicate the rupee will open at around 83.39-40 to the U.S. dollar compared with its close of 83.4250 on Friday. Indian financial markets were shut on Monday for a local holiday.

The rupee fell to a historical low of 83.43 in the closing minutes of the session on Friday and extended its decline in the offshore non-deliverable forwards (NDF) market.

The USD/INR one-month NDF rose to a peak of 83.79 on Friday, suggesting expectations of the spot being around 83.73, but eventually moved lower on the back of likely central bank intervention in the market, three traders said.

Asian currencies were mostly higher, with the offshore Chinese yuan recovering from its fall to its lowest level in four months. The dollar index was at 104.18 after falling 0.2% on Monday.

"Market will test 83.50 again if the RBI is not strong-handed and if the intervention is more concentrated in the NDF or futures segment," a foreign exchange trader at a large private bank said.

Elevated demand for cash dollars close to the end of India's financial year will also be key to watch, the trader added.

Meanwhile, U.S. Federal Reserve officials said on Monday they still expect U.S. inflation to ease but also acknowledged an increased sense of caution surrounding its trajectory.

U.S. personal consumption expenditure (PCE) inflation data due on Friday is likely to influence expectations for when the Fed is likely to begin easing rates.

The rupee's recent decline will likely be short-lived with expectations of RBI intervention supporting the currency, Arnob Biswas, head of foreign exchange at SMC Global Securities said.

KEY INDICATORS:

** One-month non-deliverable rupee forward at 83.43; onshore one-month forward premium at 6 paisa

** Dollar index at 104.15

** Brent crude futures up 0.3% at $87 per barrel

** Ten-year U.S. note yield at 4.23%

** As per NSDL data, foreign investors sold a net $159.6mln worth of Indian shares on Mar. 21

** NSDL data shows foreign investors bought a net $113.2mln worth of Indian bonds on Mar. 21 (Reporting by Jaspreet Kalra; Editing by Janane Venkatraman )