MUMBAI, May 15 Reuters The Indian rupee inched lower on Monday, bogged down by the fall in Asian peers, while forward premiums reached their lowest since February.

The rupee was quoted at 82.20 per U.S. dollar by 1054 a.m. IST, down from 82.1625 in the previous session. The rupee had fallen by 0.4 last week, tracking the jump in the dollar index.

It is unlikely that the rupee will see a larger fall from current levels, a trader at a private sector bank said. He expected the Reserve Bank of India to step in and sell dollars if USDINR reaches the 82.4082.50 level.

The dollar, supported by safehaven flows, was at its highest level in a month versus its major peers. Asian currencies dropped.

The dollar found support from the move up in U.S. yields. The twoyear U.S. yield was back to near 4 following data that slightly pushed up the possibility of a rate hike by the Federal Reserve in June. The odds though remained overwhelmingly in favour of a pause.

A survey from the University of Michigan showed longterm inflation expectations jumping this month to their highest reading since 2011.

A couple of Fed officials on Friday indicated some uncertainty about whether the U.S. central bank will in fact pause interest rate hikes next month.

Meanwhile, the oneyear implied USDINR yield dropped to 2.06, thanks to the rise in U.S. yields and India39;s April inflation data which eased to a 19month low of 4.7 in April.

We believe a macro regime shift is underway from high growthhigh…