The Indian rupee is likely to open higher on Friday, tracking the U.S. dollar's pullback against major and Asian currencies and relief on the U.S. yields front.

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Non-deliverable forwards indicate rupee will open at around 82.98-83.02 to the U.S. dollar compared with 83.1475 in the previous session.

The Reserve Bank of India (RBI) has likely been selling dollars in the offshore and onshore markets to prevent the rupee from making a new record low.

The RBI will "receive help" from the dollar's weakness in keeping local currency "hanging around" the 83 level, a forex trader at a Mumbai-based bank said.

"However, I think it is only a matter of time before we have a big move higher (on USD/INR)," he said. "The fact that you are at current levels despite RBI intervention is bullish (for USD/INR)."

The dollar index retreated from two-month highs and Asian currencies recovered on Friday. The offshore Chinese yuan rose to 7.2898, recovering from multi-month lows.

The 10-year U.S. yield dropped to 4.25 per cent, having made a new 10-month high of 4.33 per cent on Thursday.

Resilient U.S. economic data has made investors worried that U.S. interest rates are likely to remain high for longer and that policymakers may not be done with hikes.

U.S. July industrial production, retail sales and housing data pointed to a sound beginning to the third quarter.

"U.S. activity data over the last week has challenged the expectations that the economy will slow in the second half," ANZ said in a note.

If the numbers remain robust into the September Federal Reserve meeting, committee members will have to acknowledge that tighter policy settings may be warranted, ANZ said.